Good Morning from Allendale, Inc. with the early morning commentary for January 28, 2020.
Grain markets continued sliding lower lead by soybean futures, which dropped for the sixth straight session as fears the coronavirus outbreak in China will continue to spread worldwide, possibly softening demand for our commodity markets.
The European Union needs to redress a $10-12 billion imbalance in farm produce trade with the United States and adapt its food safety rules to reflect "sound science", the U.S. Secretary of Ag, Sonny Perdue said. "The European public needs to understand that their producers are going to be at a huge disadvantage... if they choose to be a technology-free zone," he said.
This week, we'll release our latest price outlooks, trade strategies, and fundamental outlooks for grains and livestock. The outlooks will be complete with a year ahead weather outlook for the world's major growing areas with Drew Lerner of World Weather, Inc. All events are in a webinar format - right on your computer or phone! Drew will kick it off this afternoon at 2 p.m. CST with his 2020 weather outlook. He'll be followed by our grain and oilseed outlooks tomorrow afternoon at 2 p.m. CST, and our livestock outlooks on Thursday the 30th. Get registered today!
President Trump offered China whatever help it needed, while the State Department said Americans should "reconsider" visiting all of China due to the virus. Canada, which has two confirmed cases of the virus and is investigating 19 more potential cases, warned its citizens to avoid travel to China's Hubei province, the heart of the outbreak.
USDA weekly grain export inspections showed corn exports at 669,000 tonnes (500,000 to 900,000 expected), soybean exports at 1,039,000 tonnes (700,000 to 1,300,000 expected) and wheat exports at 224,000 tonnes (400,000 to 600,000 expected).
Private exporters reported to the USDA export sales of 111,252 metric tons of U.S. corn for delivery to Japan during this marketing year. This is the third export sales announcement in as many days.
Brazilian farmers have harvested 4.2% of their planted area through Jan. 23, less than the 13% seen in the same year-ago period because of planting delays, AgRural said. AgRural estimates Brazil's 2019/2020 soybean output at a record 123.9 million tonnes.
Ukraine grain exports this season are up 29% over last year at 35 million tonnes, helped by higher wheat and corn exports, the Ministry for Development of Economy, Trade and Agriculture said. Wheat exports rose by 4.2 million tonnes to 15.6 million tonnes, the ministry statement said. They also exported 3.85 million tonnes of barley and 15.1 million tonnes of corn, it added. Ukraine harvested a record 75 million tonnes of grain in 2019 (70 million tonnes in 2018).
Brazil meatpacker JBS said it had signed a memorandum of understanding with Hong Kong's WH Group to supply up to $717.26 million of fresh beef, poultry and pork per year to the Chinese market. The first shipments are expected to take place in the first quarter of 2020, JBS said.
Dressed beef values were lower with choice down 0.90 and select down 0.20. The CME Feeder Cattle Index is 144.32. Pork cut-out values were down 0.12.