Morning Highlights


Highlights

  • USDA plans to do a re-survey of farmers in North Dakota and Minnesota about corn and soybean harvested acres after the large snowstorm this past weekend. Any changes in these numbers will be reflected in the November 8th crop production report.
  • Markets found strength overnight as the UK and EU have made a Brexit deal that includes an open border between Northern Ireland and the Republic of Ireland, which is part of the UK. There does not appear to be an agreement on trade yet. Opposition leaders have already stated the deal is worse than what they voted against in the past.
  • China’s Minister of Commerce said he hoped both sides would reach a phased agreement as soon as possible but would not elaborate on when additional talks would be held or how much agricultural goods China would buy.
  • Outside markets as of 7:10 AM Central: November crude oil is down $0.27 at $53.09; Dow futures are up 63 points; U.S. Dollar is down 0.273 at 97.440.
  • Tyson foods this morning said it will stop buying hogs from farmers that use the drug ractopamine starting February 4, 2020. This announcement comes because Tyson wants to capture Chinese demand. China bans pork from hogs that were fed the feed ingredient.
  • USDA export sales are delayed until tomorrow morning due to Monday’s Columbus Day.

 Corn

  • Corn is up this morning, finding support by China saying it wants a phased agreement as well as wheat markets turning higher.
  • Harvest has been fairly slow as most focus on soybeans where they can. Cash markets have remained quiet as farmers are light sellers.
  • South American export pace continues to be near record levels as the US continues to struggle finding traction on its export business.
  • Broiler-egg sets were 101% of last year and chick placements were 103%.
  • Spreads are tighter this morning with December gaining: Z/H 11 ¼ cent carry; Z/K 17 ½ cent carry; Z/N 22 ½ cent carry.

 Outlook: Mixed, lack of fresh news making things weak but wheat markets providing some support.

 Oilseeds

  • Soybeans were higher overnight, China says they want a phased agreement made as soon as possible.
  • Harvest progress has been good where they are able to get into the fields, but much of the northwestern Corn Belt is still delayed due to so much moisture.
  • Chinese soybeans were down 4 ¼ cents at 3,408 yuan per ton. Soymeal was down 1.30 at 2,966 and soyoil was up 31 at 6,022. Malaysian Palm oil was up 2 ringgits at 2,221.
  • Spreads tighter with nearby Nov staying resilient: X/F 13 ¾ cent carry; X/H 26 cent carry; X/N 43 ¼ cent carry.

 Outlook: Higher, finding some support on US-China trade deal optimism.

 Wheat

  • Wheat turned higher overnight as a Brexit deal was agreed upon between the UK and EU. Global demand also provided support to the markets with Egypt buying 405,000 metric tonnes of wheat at the highest price levels since May but none from the US.
  • Large global demand has increased the French and Black Sea futures giving support to US futures. Matif wheat futures were up one euro, reaching levels not seen since late July.
  • Australia continues to see a dry forecast with the dryness to last through the end of the month.
  • Saudi Arabia has put a tender in for 595,000 MT, likely to be Black Sea and French origins.
  • Spreads slightly tighter this morning: Chicago Z/H 4 ½ cent carry; Kansas City Z/H 12 ½ cent carry; Minneapolis Z/H 13 ½ cent carry.

 Outlook: Higher as global demand has picked up at elevated price levels.