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Daily Insights

November 29, 2022

Good morning,

Markets are quiet this morning with corn down 1 and soybeans up 1.

The announcement yesterday that OPEC would cut production put a reversal in for crude oil. This also sparked a rally in bean oil, pulling beans and meal higher with it.  Corn and wheat stayed down as the December roll and first notice day is Wednesday. Even with the selling, corn futures have been largely unaffected in price.  Dec corn futures have been trading between 6.50 to 6.70 for the past two weeks. We could see a bounce in the corn and wheat markets after first notice day, but I don’t expect much at this point.

Private analysts AgRural reported ‘22/23 Brazilian soy planting at 87% complete, slightly behind last year with center-west dryness hampering fieldwork. Summer corn planting reached 88%, down from 93% at this point last season.

US Crop progress report was delayed until this afternoon due to technical issues at the agency. This will be the last progress report until they resume in early April.

 

Have a Safe Day!

 

Garry Gard

920-348-6844

ggard@didioninc.com

November 28, 2022

Good morning,

 

Corn is down 4 and soybeans are up 7 to start the week.

 

The Funds are in control of the market, and they have been liquidating corn and bean while added to short wheat.  The wheat position is up to 75,000 short the largest in a couple years. There is not much bullish here this morning with regular rains in the early season of South American weather.  The Funds have shown little interest in commodities as of late, which looks a lot different than this time last year.  Interest rates and the high dollar do not much for a very good market.

 

Protest have erupted in China due to the lock down of cities.  The zero-tolerance policy is hitting a breaking point with the Chinese people as they hit the streets.  Public protests are very risky and rare within China, due to the government’s ability to use surveillance video to identify participants. Yet, public unrest has reached the boiling point in some locations. Many Chinese still support President Xi Jinping’s dynamic-zero policy, believing that it is the best way to protect China’s aging population, but those who do not support it are becoming more vocal.

 

There is nothing bullish in the marketplace right now and most likely won’t be for the remainder of the year unless things escalate between Russia and Ukraine again. Basis levels remain historically firm, but board prices appear to be headed nowhere. Take advantage of current levels to make some winter bin coring sales.

 

Have a Safe Day.

 

Garry Gard

920-348-6844

ggard@didioninc.com

 

November 25, 2022

Good morning,

Markets are slightly higher to open the day with corn and soybeans both trading 4 higher.

Strength this morning is coming from a stronger weekly export report along with lighter trade with many taking an extended holiday weekend. Weekly exports came in at 72.8 million bushels which is on the low end of trade estimates, but the largest we have had since last spring.

Now is the time that producers should be planning their sales for December bin coring and putting in firm offers for sales in Q1 to keep grain flow and monitor quality. This years crop was good, but not as good as last year and monitoring your bins is critical. With exports significantly behind last year and the pace needed to meet USDA projections, this market is not going to run higher anytime soon.

I look for lighter trade today with the markets closing at 12:05am.

 

Have a Safe Day!

 

Garry Gard

920-348-6844

ggard@didioninc.com

 

November 23, 2022

Good morning,

Quiet markets this morning with corn up 1 and soybeans down 4 as we head into the Holiday. The markets will close at 1:20 today (normal time) and will close at 12:05 on Friday. Historically the markets are all over the place on Friday, so stay tuned as we could see some opportunities. With a lot of traders on vacation starting today, the volatility increases.

The Funds continue to let loose of long positions into December delivery.  “The funds are estimated to be long 157,000 corn contracts. This is smallest long position in corn since 2020, which was the last time they were short.  During President Trump’s trade war, the funds sat at a record short of 344,000 contracts of corn and 171,000 of wheat, just to give you perspective.

The first vessel carrying corn from Brazil to China is scheduled to depart today, marking the beginning of a new trade relationship between the two countries. Three more vessels are scheduled to depart for China yet before the end of the month, with another in early December. Both grain sorghum and barley imports into China are expected to decline by more than 6 million metric tons. That increases the feed deficit within China. Trade chatter within China suggests that roughly 15 cargoes of Brazilian corn have already been purchased, which would amount to 1 mmt of corn. Ukraine’s corn supplies are expected to remain limited and U.S. supplies expensive, opening the door for China to buy a significant amount of corn from Brazil.

 

Have a Happy Thanksgiving!

 

Garry Gard

920-348-6844

ggard@didioninc.com

November 11, 2022

Good morning,

 

Corn is up 3 and soybeans are up 25 to start the day.

 

All you need to do is look at the US dollar chart to see where the rally is coming from.

 

Corn export sales fell short of trade expectations this past week at just 10.4 million bushels, down form 14.7 last week and 35.1 on the comparable week last year. Sales have averaged just over 11 million bushels over the past 6 weeks, compared to 45 million bushels over the same span last year.

Look for exports to remain poor with the US dollars strength in comparison to the rest of the world.

 

China is making small changes on Covid rules by shortening the quarantine by 2 days, down to 5 for close contract or foreign visitors.  China ended its circuit breaker penalties for airlines.  China reported 10,535 new cases overnight, additional lockdowns are expected this weekend.

The forecast in South America is wet over the next 10 days. Rains will be moving in over the weekend in both Brazil and Argentina.  Amounts will be 1.5-3.5 inches for Brazil and .5-2.5 inches in Argentina.  Temps will be normal.  After this system moved out Argentina weather goes back to dry on the long-range forecast.

 

Have a Safe Day!

 

Garry Gard

920-348-6844

ggard@didioninc.com

 

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