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.

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

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