Harvest Progress Below Expectations Again

Published on: 05:46AM Nov 19, 2019

Good Morning from Allendale, Inc. with the early morning commentary for November 19, 2019.

Grain markets are mostly higher on quiet volume. U.S. – China trade pessimism, light fund selling, and improvements in South American weather are limiting factors to any gains. Traders will continue to focus on export sales and harvest progress as we move closer to Thanksgiving.

USDA weekly crop progress report showed corn harvest rating at 76% complete (77% expected, 66% complete last week, 89% last year, 92% 5-year average).  Soybean harvest rating at 91% complete (91% expected, 85% last week, 91% last year, 95% 5-year average).  Winter wheat conditions at 52% GTE (53% GTE expected, 54% last week, 56% last year).  Winter wheat planting at 95% complete (95% expected, 92% last week, 92% last year, 95% 5-year average).

China continues to press the U.S. to roll back punitive tariffs in a tentative trade deal.  A tariff cut is an "important condition" for the agreement that is part of talks on ending a costly trade war, said Commerce Ministry spokesman Gao Feng.  Some economists believe a final settlement is unlikely this year. Some have expressed skepticism the two sides can complete the "Phase 1" deal at all.

USDA weekly grain export inspections recap for the week ended 11/14/19 showed corn exports at 637,000 tonnes (expecting 400,000 – 700,000 tonnes), soybean exports at 1.533 million metric tonnes (1.0 – 1.5 mmt) and wheat exports of 449,000 tonnes (350,000 – 550,000 tonnes).

Regional propane shortages, have led to emergency declarations covering nine Midwest states amid late harvests of soggy grains.  Iowa, Minnesota, North Dakota and Wisconsin declared state emergencies beginning in late October and continued to ease hours of service or load restrictions on delivery vehicles.  Regulators later issued a regional waiver covering those states plus Illinois, Kansas, Missouri, South Dakota and Nebraska to help alleviate local shortages aggravated in part by a Midwest pipeline outage.

USDA confirmed U.S. exporters sold 132,000 tonnes of corn to an unknown destination during the 2019/20 marketing year.

Strategie Grains lowered its estimate of the EU wheat area for next year's harvest after heavy rain disrupted field work in the western EU countries.  In a monthly report, the firm pegged the EU's soft wheat area for 2020 at 23.7 million hectares (23.9 million hectares last month, 23.8 million hectares estimated harvested this year).

U.S. plant-based "meat" makers targeting China like Impossible Foods and Beyond Meat Inc. will need to battle homegrown rivals which are developing local favorites such as dumplings and mooncakes to nab a share of the lucrative market.  Among the new players are names like Zhenmeat and Starfield, while long-time plant-based companies including Whole Perfect Food are rolling out new products.  (Reuters)

Tyson beef plant in Kansas will resume operations the first week in December.  Since the fire, cattle have been diverted to other Tyson beef facilities, where they were able to offset some of the production volume losses.  Efforts to resume harvest operations/receiving cattle will start first week in December, with intentions to be fully operational by the first week in January.

Dressed beef values were mixed with choice down 1.68 and select up 1.26.  The CME feeder index is 146.69.  Pork cut-out values were up 1.01.

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