Good Morning,

Yesterday’s rally in corn and soybeans was a pleasant surprise fueled by rumors that Argentina may increase its export tax to 33%.(up from 25%) Rumors that China bought up to 15 cargos of Argentine beans that are a replacement of soybeans they sold to China. If Argentine commercials re-export the products, then the country’s taxation scheme would not be applicable on those products. This would mean that any beans that Argentina buys from the US and sells to China would avoid this taxation. (More bean exports for the UW) Brazil appears to be making the same plans as they buy 1.0 mmt of US soybeans. While this may help grain prices for a bit, the US farmer needs a resolution between the Chinese government and US government to eliminate the tariffs that are in place or going to be in place. Until this happens traders will be cautious to be long any commodity.
Reports of yields all over the board continue to roll in from the south on corn and soybeans. The majority continue to be higher than last years levels. Elevators in central IL are hoping for some rain this weekend or early next week to help slow down the harvest pace as they are running into space issues. I have talked to several elevators that said the speed, dryness and size of this years corn and bean crop is putting a lot of pressure on them early in harvest that they are struggling to handle. If this in any indication for the things to come in WI, I would advise producers to make sure you have a game plan! Here are some tips to help avoid harvest issues:
1. Fill elevator/end user contracts first. Don’t wait until your bins are full. If you deliver the first grain harvested you can usually avoid the big harvest rush.
2. Make sure you have enough sales made. Some locations may not be taking new contracts or spot bushels when you run out of room at home. If you don’t like the cash price, make a basis contract. Basis levels are the widest when you and everyone else is looking for a place to deliver.
3. Talk with your elevator/end user to make sure you are in agreement on what contracts you have and what delivery time you have on them.
4. Plan ahead. Make sure you know the hours of receiving. If you are delivering to Didion, YOU MUST SCHEDULE YOUR DELIVERIES! We are still buying and taking spot loads, but the delivery date of these must be scheduled. Call Mitch or Garry to schedule when you would like to deliver.

Have a Great Weekend!

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

Good Morning,

We are seeing a slight rebound in the markets this am with corn up 1 and soybeans up 6. Profit taking is the only reason for the market uptick this am as reports of good yields and more tariff news.

China announced another round of retaliatory tariffs of 5-10% on US goods and products in response to the US tariffs yesterday. Trade meetings were to be held next week, but will now likely be canceled. The executive from one of China’s biggest soybean crushers sat on a panel at a Kansas City agricultural
exports conference, listening to an expert beside him explain why China would remain dependent on U.S. soybeans to feed its massive hog herds; when his turn to speak came, Mu Yan Kui told the international audience of soy traders that everything they just heard was wrong; then Mu ticked off a six-part strategy to slash Chinese consumption and tap alternate supplies with little financial pain. Just one prong of the strategy Mu detailed – to slash soymeal content in pig feed – could obliterate Chinese demand for U.S. soybeans if broadly adopted; cutting the soy ration for hogs from the typical 20 percent to 12 percent would equate to a demand reduction of up to 27 million tons of soybeans per year. An amount equal to 82 percent of Chinese soy imports from the United States last year.

Informa projected that U.S. corn plantings would rise to 93.044 million acres in 2019 compared to the U.S. Department of Agriculture’s 2018 figure of 89.1 million acres. Informa projected a drop in U.S. 2019
soybean plantings to 82.27 million acres, down from the 2018 figure of 89.6 million acres.

Have a Safe Day!

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

Good Morning,

The markets are trading mixed to start the week as traders prepare for a new round of tariffs from President Trump on China. This also weighing on the outside markets with China saying it’s ready to respond.
November soybeans are lower as well with futures back near last week’s lows as traders worry that this latest round of trade war rhetoric from the White House could lead to China walking away from plans for sitting back down at the negotiating table.
In an interesting turn of events, the President Trump did offer to cut the effective tariff rate to 10% from 25%. Regardless, the market will be concerned with the timing for the activation of the new set of tariffs. Should they be delayed for a month, this would leave open the possibility that some sort of deal could be worked out by trade negotiators for both sides in a fresh round of talks set for the end of the month.

Have a Safe Day!

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

Good Morning,

Corn and soybeans are currently trading even this morning. World trade watches, as no major events have happened in trade negotiations to make stability for supply and demand. Beyond that-the U.S. is having a great start to harvest with this dry stretch in the lower Corn Belt. This is another event that producer are likely going to cross off the list that could have been a catalyst for a market rally.

Producers that have been holding out to market the last of their old crop corn and make sales for fall delivery timeframes have run out of time. This week’s report gave us additional bearish news that will not be updated until November. Cash levels and basis levels have both dropped in the last couple months as we moved closer and closer to harvest. Look for basis levels across the country to widen as space becomes an issue with carryout from last year and the size of this year’s corn and bean crop. Producers should be actively locking in Basis levels for any grain they need to move.

Have a Great Weekend!

Mitch Giebel
920-348-6861
mgiebel@didionmilling.com

Good Morning

Yesterday’s WASDE report was a shocker to say the least. Expectations for corn yield were in the 177.4 bpa range compared to 178.4 in August. But favorable weather and record ears and ear weights drove the forecast to 181.3 bpa. This would eclipse the 2017 record yield of 176.6 by 4.7 bpa. Ending stocks were increased by 90 million bu. to 1.774 billion bu.
Soybean yields were increased 1.2 bpa from last month to 52.8 bpa. Carryout of soybeans now stands at 845 million bu. leaving the soybean stocks to use ratio just under 20%. (Producers that attended last Fridays meeting may recall what that means for cash prices). Despite the higher yield projections, soybeans managed to trade higher yesterday on rumors that the US is going to propose new Chinese trade talks. (Buy the rumor – sell the fact?)

Ethanol production for the week ending 9/7 averaged 1.02 mil barrels a day which is down 6% from a week ago and 3% from last year. Stocks totaled 22.9 mil barrels which is up 1% from last week and 8% from last year.
Weekly export sales were strong for both corn and beans. Corn came in at 30.5 mln bu. while soybeans were reported to be 25.5 mln bu. Both more than double their 10 week average.

Producers that have been holding out to market the last of their old crop corn and make sales for fall delivery timeframes have run out of time. Yesterday’s report gave us additional bearish news that will not be updated until November. Cash levels and basis levels have both dropped in the last couple months as we moved closer and closer to harvest. Look for basis levels across the country to widen as space becomes an issue with carryout from last year and the size of this years corn and bean crop. Producers should be actively locking in Basis levels for any grain they need to move.

Here are yesterday’s numbers:

USDA 2018/19 US Production (billion bu)
USDA Sept 12 Average Estimate USDA August
Corn Yield 181.3 177.8 178.4
Corn Production 14.827 14.529 14.586
Soybean Yield 52.8 52.2 51.6
Soybean Production 4.693 4.649 4.586

USDA 2018/19 Ending Stocks (billion bu)
USDA Sept 12 Average Estimate USDA August
Wheat .935 .941 .935
Corn 1.774 1.639 1.684
Soybeans .845 .830 .785

Have a Safe Day!

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