Can Corn & Wheat Stay Higher Despite Escalating Trade Disputes?
Sep 25, 2018
Good Morning! From Allendale, Inc. with the early morning commentary for September 25, 2018.
Grain Market Traders experienced another mixed trading session on Monday with soybeans sliding lower while corn and wheat extended last week’s gains. All three commodities are hovering around strong resistance levels while waiting for any signal on what direction to head. Trade deals remain the major focus, while El Nino talks and pre-report positioning are also having an influence.
Crop Progress Report numbers were released yesterday afternoon with corn good to excellent at 69% (68% expected, 68% last week) and soybean GTE at 68% (67% expected, 67% last week). Corn harvest came in as expected at 16% complete (9% last week) while soybean harvest was 14% complete (13% estimate and 6% last week). HRW wheat planted is 28% complete (25% estimate and 13% last week).
Average estimates for this week's USDA grain stocks report were compiled and released by Reuters. Analysts expect wheat stocks of 2.343 billion bushels, corn stocks of 2.010 bb, and soybeans of .401 bb. The report will be released this Friday at 11:00 AM CDT.
Commodity Funds were net buyers of CBOT corn, wheat and soyoil futures contracts on Monday and net sellers of soybean and soymeal futures. They bought 11,500 corn contracts, 4,500 wheat contracts and 3,000 soyoil contracts. Funds were net sellers of -5,500 soybean contracts and -2,500 soymeal contracts.
China's grain imports fell sharply in August, customs data showed on Sunday, a month after Beijing imposed hefty tariffs on shipments from the United States, one of its top suppliers. (Reuters)
Canada & US NAFTA Talks will continue this week. U.S. and Canadian officials are still trying to reach a deal and are "very likely" to hold informal talks on the sidelines of a major U.N. meeting in the next few days. U.S. and Canada are divided over the best way to resolve trade disputes as the U.S. demands more access to Canada's protected dairy market.
U.S. and China imposed fresh tariffs on each other's goods yesterday as the world's biggest economies showed little signs of backing down from an increasingly bitter trade dispute that is expected to knock global economic growth. The US imposed a tariff of $200 billion worth of Chinese goods while China retaliated by launching tariffs on $60 billion of US goods. China has also cancelled upcoming trade talks with the United States and announced they will no longer send vice-premier Liu He to Washington next week.
Cold Storage was released yesterday at 2:00 PM CDT. The USDA counted 582.592 million lbs. of pork at the end of August (556 million lb. Allendale’s estimate, 586 million lbs. five-year average). 503.449 million lbs. of beef was found in the nation's frozen warehouses at the end of August (481 million lbs. estimate, 440 million lbs. five-year average).
Another New Case of African swine fever was detected again Monday in inner Mongolia as authorities continue to struggle to contain the highly contagious disease.
December Live Cattle futures traded lower yesterday down 85 cents closing at $117. Strong resistance still remains at the $119 level and with key support at $116.
Cash Hog Prices continued pushing higher yesterday, making it 14 out of the last 16 days higher. All US hog slaughter plants were back online today.
Dressed Beef Values were higher with choice up 1.36 and select up .68. The CME Feeder Index is at 157.34. Pork cutout value was up 0.84.