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Daily Insights

November 29, 2021

Good morning,

Weaker markets to start the week as corn is down 9, soybeans are down 7 and wheat is down 13.

Following a trade shortened week where due to the holidays, traders appear to be taking some money out of the markets as we head towards first notice day for the December futures. The surprising thing here is that December corn is only 4-5 lower while future months are trading 9 lower.

Concern over the new Covid 19 variant may be directing the markets today. While scientists race to understand the consequences of the Omicron COVID-19 variant, one of the most important questions is whether this new version of the coronavirus can outrun the globally dominant Delta variant.

The World Health Organization on Friday designated Omicron a “variant of concern” just days after the variant was first reported in southern Africa. The WHO said it is coordinating with many researchers worldwide to better understand how the variant will impact the COVID-19 pandemic, with new findings expected within “days and weeks.”

US weather is going to be very dry over the next couple weeks.  The maps show a drying trend out in the Plains and down into Texas.  Temps are above normal for the time of year as a warm air doom has set up across the entire Western US.  Dry warm weather may have some effect on the winter wheat crop, where conditions have not started out very good.

Today is a small reminder of what can happen at any given time. High prices are not guaranteed regardless of what input costs may be. If you can print in the black, you should consider making old and new crop sales.

Have a Safe Day!

 

Garry Gard

920-348-6844

ggard@didioninc.com

 

 

November 22, 2022

Good morning,

Markets are higher to start the week with March (CH) corn up 4 and January (SF) soybeans up 10.

Today, the wheat market is the one making headlines and leading the charge.  Wheat is up big across the board due to a wet forecast for Eastern Australia, the nation’s primary growing region for the commodity.  The forecast now shows 1.5-4.5″ of rain in the coming period causing concern that harvest will be delayed and the seed quality will be diminished.  This causes concern that the resulting crop will not be able to meet the milling demands of the nation’s Asian trade partners.  Both Kansas City and Chicago wheat have posted fresh contract highs and are testing prices last seen in 2012.

The US forecast is little changed from last week.  Most of the country remains in a dry, cool pattern.  The updated forecast does show a fresh round of heavy rains for southeast Canada, the same region that was hit with heavy rains that caused tragic landslides recently.  These new rains could spark more landslides and slow down grain export activity.

Its Thanksgiving week which means a short week for CBOT trade with the exchange closed on Thursday and an early (12pm) close on Friday. Look for thin markets this week with limited volume of trade.

Historically, CBOT have trended higher leading up to the Thanksgiving holiday.  With wheat leading the charge, I expect that to be the case again this year.  As the week goes on, the trade will be thin out and markets may see an uptick in volatility. I expect much of the week’s action to be done shortly after the open on Wednesday as traders leave the desk to enjoy the holiday break.

Have a Safe Day!

 

Garry Gard

920-348-6844

ggard@didioninc.com

 

November 19, 2021

Good morning,

Markets are quiet this am with corn and soybeans both unchanged.

A stronger US dollar, lower crude and lower equities with the DOW down over 250 points could add pressure to the grains, but instead they appear to be safe havens for investors.

With Covid cases rising globally an da few countries going into lock-down, there is concern over global demand for grains.

The overnight forecast run for South America now shows chances for light showers for the greater Buenos Aires region in the coming 10 day period.  The forecast calls for normal to above normal rainfall across Northern and Central Brazil.  Too much rain and chances for disease increase; the region will need warmer, sunnier conditions as the bean crop starts to bloom.  Southern Brazil and Argentina remain dry, with chances for light showers (less than 1″) coming in the final days of November.

Producers should be talking with their grain buyers and getting firm offers and plans in place for December and Q1 sales. With the funds long 300k+ contracts it may take something significant to move these markets higher. A January report with higher production or a continued absence of Chinese buying is likely to move this market lower.

Look for limited trade next week with the holiday and lower volume.

 

Have a Safe Day!

 

Garry Gard

920-348-6844

ggard@didioninc.com

 

November 15, 2021

Good morning,

Softer markets to start the week with corn down 7 and soybeans down 5.

The forecast this morning is moving to a drier pattern next week. Temps will be on the cool side, but about normal for this time of year.  Harvest should have little trouble getting underway this week. We should have a good chance of finishing up by Thanksgiving. Last week’s report saw 84% of anticipated 2021 U.S. corn acres harvested and 87% of U.S. soybean acres completed for the week ending November 7. This afternoon’s report should have us north of 90% on corn and soybeans.

The South American forecast is wet over the next 10 days. Northern Brazil will see heavy rain fall next week, holding in this very wet pattern. Argentina will have about 1-2 inches of coverage over most of the growing area. Their forecast may be too wet for the time being but has not delayed planting progress from averages.

President Biden and Chinese President Xi Jinping will have a summit meeting today. This will be the big story for this week and perhaps foreshadow what will happen when the trade agreement is up in 45 days.

A Biden administration official said the U.S. expects the virtual summit at 7:45 p.m. on Monday night in Washington to last several hours, a time frame that includes translation for both leaders in their third conversation this year. It comes as the world’s two biggest economies spar regularly over the origin of Covid-19, human rights in Hong Kong and Xinjiang, and the status of Taiwan.

While those issues aren’t going to be resolved in the meeting, the U.S. says it wants to put “guardrails” on the relationship, so it doesn’t get worse. The U.S. official, who asked not to be identified, told reporters that Biden will press Xi to abide by established international norms.

 

Have a safe day!

Garry Gard

920-348-6844

ggard@didioninc.com

October 25, 2021

Good morning,

 

Corn is up 1 and soybeans are up 10 to start the week.

Heavy rains over across the Midwest over the weekend slowed the late stages of corn and soybean harvest. The US weather is really wet into Thursday of this week. After this system passes, there is another one just about as big that develops Wednesday and moves through the Central US into Friday.  The forecast shows a clear out of rain from Saturday to the end of the model run on November 7th.  No other major storm system is forecast as of this morning.  Temps look to be cooler as some cold air is going to move down from Canada.  Not very good weather for harvest this week and it’s going to take a while to dry down.
Last week’s report saw 52% and 60% of U.S. corn and soybeans, respectively, harvested as of October 14. Both figures remained higher than the five-year average though the gap between the two metrics narrowed slightly week over week. Trade is looking for corn to be around 65% complete and soybeans 70% complete in this afternoons report.

Wheat continues to climb higher on the CBOT making contract highs over the last few days. Strength in the wheat market has spilled into corn and soybean helping pull them higher recently. Decent export demand along with questionable plantings is giving wheat legs.

Have a safe day!

 

Garry Gard

920-348-6844

ggard@didioninc.com

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