November 11, 2019 Comments per MIDCO
Good morning. Grains and soybeans are lower this morning as good harvest progress was made over the weekend and more doubts about a Phase 1 trade agreement surfaced. Today is Veteran’s Day – grain markets trade normal hours, banks are closed , and there is no mail delivery. Thanks to all those who served! It was probably the best harvest weekend of the season and a lot of corn fields disappeared. Soybean harvest is all a bit wrapped up in most of the Midwest. There are still some bean fields left to cut across northern Missouri, but excellent progress was made there the past 5 days. U.S. trade officials are signaling that the U.S. will not reduce tariffs on Chinese imports should a Phase 1 agreement be signed. This, of course, has traders worried that a deal won’t get done. Friday’s crop report was slightly bearish, with the USDA kicking the can down the road to the January report (1/10/2020) on acreage and with a lot of uncertainty regarding soybean yield. The trade seems to generally feel that the soybean yield of 46.9 is too high. A wide swath of the Midwest will get several inches of snow today followed by bitter cold. Harvest will be slowed but should ramp back up later in the week as temperatures moderate. Lots of elevators are way behind drying corn as receipts of wet corn have been big and dryer fuel is in short supply. Commodity funds were sellers of soybeans and wheat on Friday and buyers of corn. Current estimated fund positions include long 55,000 soybean contracts and short 125,000 corn and 9000 Chicago wheat contracts. Federal offices are closed for the Veterans Day Holiday, so no export inspection or crop conditions report today as all reports this week are backed up a day. Expect markets to trade in the red today unless we get something positive trade-wise. Have a good Monday.