High-level meetings between Secretary of State Pompeo and a Chinese Communist Party Politburo Yang in Hawaii yesterday were productive. Pompeo was able to secure new assurances that China would still comply with the Phase 1 trade deal and its associated Ag purchases. Beijing promised to accelerate the purchases of US Ag goods going forward.
Rumors are that China was seeking offers on ethanol, HRW wheat, soybeans and corn following the meeting in Hawaii. While it always nice to hear that export business with China is encouraging, at this point, the demand will have little impact near-term on the longer-term oversupply issues we face.
Weather models look to be in good agreement in calling for a progressive weather pattern developing over the next 2 to 3 weeks as a series of high pressure ridge and troughs push east. Fortunately, none of the ridges look to be particularly strong and with all the moisture moving up from the Gulf will provide daily chances for showers and storms through the 4th of July holiday.
The rumors of Chinese demand are helping to support prices. I do not recommend chasing any rallies at this point due to the favorable weather outlook. Any rally should be rewarded with old and new crop sales.
Have a Safe Day!