Good Morning from Allendale, Inc. with the early morning commentary for December 4, 2019.
Grain markets are mixed as traders deal with weather concerns across the globe, add that to constrained enthusiasm for a trade deal between the US and China over a new deal that may or may not happen after the recent G20 headlines, and who knows?
President Trump said a trade agreement with China might have to wait until after the presidential election in November 2020. "In some ways, I like the idea of waiting until after the election for the China deal. But they want to make a deal now, and we'll see whether or not the deal's going to be right; it's got to be right," he added.
Huawei, China’s largest company, has been encouraging its suppliers to violate U.S. law by telling them to move operations offshore in a bid to avoid U.S. sanctions, Commerce Department Secretary Wilbur Ross said. "They have been openly advocating companies to move their production offshore to get around the fact that we put Huawei on the list," Ross said. "Anybody who does move the product out specifically to avoid the sanction... that's a violation of U.S. law. So here you have Huawei encouraging American suppliers to violate the law," he added.
France and the E.U. said they were ready to retaliate if President Trump acted on threats to impose duties of up to 100% on imports of champagne, handbags and other French products worth $2.4 billion. The spat marks a new low in testy relations between Trump and Macron, who have been at odds over the American's unilateralist approach to trade, climate change and Iran.
Brazilian farmers are expected to plant more than 18 million hectares of corn this coming season (3.5% higher than last year and a record area planted), according to Reuters. Total corn crop forecast seen at 101 million tonnes (102.3 million tonnes last month).
President Trump said he was looking at imposing sanctions on Turkey over its purchase of a Russian missile system. "As you know Turkey wanted to buy our Patriot system and the Obama administration wouldn't let them, and they only let them when they were ready to buy another system," he added.
Egypt's state grain buyer GASC said it bought 295,000 tonnes of Russian wheat at its latest international purchasing tender.
Live cattle futures are suggesting last week's $118 cash cattle trade will not move much for the rest of the month. Market moving news regarding cattle this month could remain quiet.
Pork, by far the most popular meat in China, has pork supplies declining sharply causing food inflation to run at its highest level in eight years and has surprised both seasoned economists and restaurateurs. "In the past year, both we and the market underestimated the pace of pork price inflation," said Lu Ting, analyst at Japanese bank, Nomura.
Dressed beef values were lower with choice down 2.46 and select up 0.67. The CME feeder index is 145.03. Pork cut-out values were down 2.25.