The markets look to stage a Turnaround Tuesday after reports out yesterday morning on CNBC that President Trump was not prepared to rollback US tariffs on Chinese goods. Additionally, it has been reported that the two sides continue to butt heads over the size of US Ag purchases. The word that we are getting is that President had not made a final decision on the tariffs; however, the situation remains fluid with negotiations on a Phase 1 deal occurring on a daily basis.
Prices on the board continue to look cheap and should help to entice some activity in the export markets. For the second consecutive day we have a sale of corn to Unknown Destination reported on the daily system and beans out of the Gulf are the cheapest in the World. With US grain and soy now much more competitively priced we have begun to see business pick up. Yesterday we saw a sale for 132 TMT of corn to Unknown and then again today we got another for 191 TMT of corn to Unknown Destinations.
Now that the US harvest is nearly complete, the pro’s focus will now shift to South American weather and at least for now the forecast looks pretty favorable over the next couple of weeks. The major models remain in good agreement in calling for an active wet weather pattern settling in for the balance of November.
The December corn board is currently trading 27 cents below this same date last year. Cash prices this fall have been much better than last fall and its all due to basis levels across the Midwest. This is one big reason that I believe producers should be locking in basis contracts for fall and spring/summer delivery. Any move higher in the CBOT is going to result in weaker basis levels.
Corn is up 3 and soybeans are up 4 to start the day.
Have a Safe Day