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