November 15, 2019

Good Morning,

Corn is down 2 and soybeans are up 4 to start the day.

More back and forth talks about the US and China, and more of the same coming out of the White House. Comments that they are getting close to a partial deal continue to be the talk, but still no deal.

The decision by China to allow US poultry into the country had to have helped, lifting the ban from 2015. If the US government is feeling the doors more wide open a trade agreement is much more likely. Unfortunately this has nothing to do with more free trade, and everything to do with rampant food inflation brought by AFS.

I still believe that we are along ways away from any deal getting done that would significantly support US grain markets. In my opinion, the Chinese still hold the key to getting a deal done with all the pressure on President Trump.

South American weather has been very favorable with rains moving across Brazil and Argentina which is very welcome. There are only small pockets of Argentina and North Eastern Brazil that remain dry. This should support their intentions to plant more corn and beans than last year which will continue to put pressure on US exports.

Forecasts locally for the next week look favorable for harvest progress with slightly warmer and dryer conditions in the forecast thru next Thursday.

Have a Safe Weekend!

Garry Gard
920-348-6844
ggard@didionmilling.com

November 13, 2019

Good Morning,

Prices over at the CBOT were a little lower last night with follow-through buying absent after the pros were remained in the dark on any new detail of the Phase 1 trade agreement. Corn is down 2, soybeans are down 1 and wheat is down 4 cents.

Radar shows more snow moving out of the western Corn Belt this morning. Accumulations with this system don’t look to be especially heavy and will likely melt quickly with temperatures expected to moderate early next week. Mother Nature looks like she will cooperate into early December and allow harvest to get back on track. Corn harvest last night was reported at 66% complete for the US compared to the 5 year average of 85%. Wisconsin came in at 30% compared to the 5 year average of 65%. This is the third slowest pace for corn harvest on record, with the rates across the upper Midwest and Plains running well behind normal rate.

President trump offered no details on the trade situation in yesterday’s speech which left traders with no direction on the trade front. Fundamentals will be the trade for now as we are still dealing with a 1.91 billion bushel carryout.

Have a Safe Day!

Garry Gard
920-348-6844
ggard@didionmilling.com

November 12, 2019

Good Morning,

Overnight corn and beans were unchanged after yesterday’s selloff of 14 cents in soybeans and 4 cents in corn. The markets were under heaving fund selling yesterday with traders monitoring comments from President Trump. The markets closed at their lowest level since the September stock report. The USDA’s November report removed most any chance of bullish surprises with acreage and yield. One bit of hope to hang on to is the correlation to the direction of the Oct-Nov yield change compared to the Nov-Jan yield change. (chart below)The problem with this is that we need to wait two months for the data and it may be too late for the market to react. Once we get into January the trade will start to focus on the coming years acres and production instead of what is behind us. With ta 167 bpa yield and planted acres at 94 million, next years carryout looks to be right in line with this years at 1.906 billion bushels. Keep in mind this is using a 167 bpa, which is what we are using this year with poor growing conditions. The more this increases, the less likely we are to see this corn market at the current levels next year.
I would advise producers to take advantage of historically strong basis levels for the crop they are harvesting now and start to lock in some of next years production at current cash levels.

NASS crop progress will be out later today with expectations for corn harvest to be 65% complete and soybean harvest 85% complete. Drying issues continue with the shortage of LP and the crop not drying down much in the field with later planted varieties. This reminds me of 2009 only on a larger scale when harvest drug into December.

The trade will be awaiting President Trump’s update on the Phase 1 deal with China later today.(11am central) My guess is that he would be positive about the trade deal, but not commit to anything. Any negative comments from the President today could be volatile to the markets.

[rl_gallery id=”3291″]

Have a Safe Day!

Garry Gard
920-348-6844
ggard@didionmilling.com

Good Morning,

Happy Veteran’s Day and Thank You to everyone that has and still does serve our nation!

Weaker markets to start the week off with corn down 2 and soybeans down 9.
The trade negotiations with China appear to have slowed again over the weekend as president Trump denied that he has agreed to rollback tariffs.

With Fridays report behind us and no major surprises in the USDA’s numbers from the October report, traders will now have little fundamental news to move the markets for a couple months. The weekly progress report will be delayed until tomorrow due to Veterans Day. Trade is looking for tomorrows report to show 65% of the nations corn and 85% of the nations soybeans harvested.

There are no major weather changes in the 1-5 day forecast for Brazil with rains still expected to help replenish the moisture profiles across the central and northern soybean growing regions.

Have a Safe Day!

Garry Gard
920-348-6844
ggard@didionmilling.com

Good Morning,

Quiet markets to open the day as traders await the 11am WASDE report. (Estimates listed below) Heading into today’s report the spec funds are carrying a rather large short position in corn and long position in soybeans given the private estimates for today’s report. This could set up for some major reversal trade if today’s numbers come in near the private estimates. I personally think today’s report is going to show a higher yield in corn and unchanged harvested acres. While the major focus will initially be on yield and acres, the final ending stocks number will set the tone for trade after today up to the January report. If ending stocks are not lowered (due to decreased production or increased demand) we will see a lid on the market at least until the next WASDE report. (January)

China made headlines yesterday when it stated that it agreed to a deal with the US to roll back many of the tariffs imposed during the trade war. That suggests that China is trying to use the media to leverage the trade talks, putting the pressure on the US to agree to such in order to get phase one deal done. President Xi knows that President Trump needs a political win in the upcoming election in the face of the House’s impeachment inquiry and knows that Trump would not want to be seen as the one who failed to get the deal done.

Corn
USDA November Ave. Estimate USDA October
Production 13.661 13.643 13.779
Yield 167.0 167.5 168.4
Harvested Acres 81.815 81.455 81.815
Ending Stocks 1.910 1.817 1.929

Soybeans
USDA November Ave. Estimate USDA October
Production 3.550 3.510 3.550
Yield 46.9 46.6 46.9
Harvested Acres 75.626 75.422 75.626
Ending Stocks .475 .428 .460

Be sure the check back in after 11am for today’s numbers.

*We are currently NOT discounting or rejecting for vomitoxin*

Have a Safe Day!

Garry Gard
920-348-6844
ggard@didionmilling.com