Morning Highlights


Highlights

  • The U.S. and China are set to sign Phase 1 of the trade deal tomorrow, Wednesday January 15th.
  • Wetter weather is finally expected to hit eastern Australia later this week and into next week. The rains should help provide some relief from the wildfires and lead to improvements in soil moisture.
  • China customs vice minister Zou Zhiwu stated that Chinese imports of U.S soybeans and pork rebounded in November and December, with the December soybean imports seen at the highest levels since May of 2018.
  • According to Chinese customs data, China imported 375,000 tonnes of pork in December of 2019 vs just 95,384 tonnes in December of 2018. November imports were seen at 229,707 tonnes.
  • Poland has been hit by another case of bird flu, causing for about 6,000 geese to be culled.
  • As of 7:00 AM: Crude oil up 0.37 at 58.45, Dow futures steady at 28,871, and the U.S$ index up 140 ticks at 97.485.                          

 Corn

  • The corn market is trading mostly unchanged overnight as traders continue to wait for Phase 1 of the U.S and China trade deal to be signed.
  • India’s MMTC raised the amount of corn they are seeking via tender from 50,000 tonnes to 175,000 tonnes.
  • Open interest for corn is up 8,555 contracts, with the May contract up 2,289 contracts, the September up 4,101, and the December up 2,265.
  • Spreads: H/K 6 ¾ cent carry; K/N 6 ¼ cent carry; N/Z 1 ¾ cent carry .

Outlook: The market will remain steady this morning and continue to be rangebound until it can find some fresh news to trade.

 Oilseeds

  • The soybean market slightly higher this morning due to optimism that Chinese buying will pick up after Phase 1 of the trade deal is signed tomorrow.  
  • The trade expects to see NOPA crush for December at 171.644 million bushels.
  • Chinese saw a 67% increase in soybean imports during the month of December, they brought in a total of 9.54 million tonnes of soybeans compared to 5.72 million tonnes in December of 2018.
  • Chinese soybean imports for 2019 came in at a total of 88.51 million tonnes, compared to 88.03 million tonnes in 2018.
  • Malaysian palm oil futures fell by 2.8% during today’s session due to continued tensions between India and Malaysia, the benchmark contract was seen at 3,005 ringgit, the largest one day fall since May 2019.
  • Spreads: H/K 13 carry, H/N 24 ¾ carry, N/X 1 ¾ carry

Outlook: Steady to lower as traders await more details regarding the signing of Phase 1 this week.

 Wheat

  • Wheat markets higher overnight, gaining support from the numerous tenders and strength in Paris milling wheat futures.
  • Russian wheat exports decreased to 29.2 million tonnes for January-November of 2019, vs 40.2 million tonnes the year prior.
  • The lowest offer for Turkey’s tender to purchase 550,000 of red milling wheat is $237.99 a tonne c&f
  • Egypt’s GASC tender’s lowest offer was seen at $235.30 a tonne FOB for 60,000 tonnes of Russian wheat.
  • No purchase has been made yet for Jordan’s tender for 120,000 tonnes of wheat, however it is believed that five companies have made offers.
  • Spreads: Chicago H/K 1 ¾ cent carry; Kansas City H/K 7 ½ cent carry; Minneapolis H/K 8 ¼ cent carry.

Outlook:  Slightly higher today as world demand and strength in European prices will continue to support the market