December 6, 2021
Good morning,
Softer markets to start the week with corn down 5 and soybeans down 6.
Canada’s main crop came in above trade expectations in StatsCan’s December crop report on Friday, with all-wheat output at 21.7 MMT; that was 500k tonnes above the trade guess but still only steady with their previous projection, and their worst wheat crop since ‘07/08. Production of those six main crops (combined below) stands at just over 64 MMT for 2021, down from a record pushing 90 MMT in 2020 and the lightest output since the ‘07/08 season.
The forecast for South American weather looks unchanged from yesterday. Northern Brazil will have chances for 2-5 inches of rain this week. Southern Brazil and most of Argentina didn’t get much rain coverage over the weekend. Southern Argentina is expected to see .1-1.25 inches into Friday. Temps in Northern Brazil are below normal and temps in Argentina are heating up.
The USDA will release their monthly S&D report on Thursday. Trade expectations are for slightly lower stocks due to an increased ethanol demand number. 2021 production numbers will not be updated until the final report in January.
Look for the markets to continue their sideways trading range as we have nothing bearish or bullish going on in the marketplace.
Have a Safe Day!
Garry Gard
920-348-6844
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
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
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
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
