Geopolitical Events Back in the Spotlight
May 29, 2018
Good Morning! From Allendale, Inc. with the early morning commentary for May 29, 2018.
Grain markets return from the long holiday weekend with geopolitical events back in the spotlight. NAFTA, US/Chinese trade, and the North Korean summit are all important events which will make headlines this week.
USDA will release crop conditions and start the weekly crop ratings numbers today. Allendale expects a respectable ratings number for corn to be in the 67% - 72% range, last year we started with 65% good/excellent.
Brazil's President Temer announced the signing of three decrees which would take effect immediately to address the demands of truck drivers who have been striking in the country. The Brazilian truckers association behind the strike has told drivers to return to work, but warn that could take some time.
US Weather over the holiday weekend was mostly favorable for crops. World Weather, Inc. noted, "The bottom line for U.S. crop areas remains favorable for most of the Midwest, northern Plains, northern Delta and a part of the central Plains. Some areas in the northern Plains may trend a little too wet later this week and the same is expected in the southeastern states."
Argentina is raising an export tax on biodiesel from 8% to 15% on July 1st. President Macri said that the increased tax is meant to "continue fostering convergence" between taxes on biodiesel and soy oil exports.
Fund positions for the week ending 05/22/2018 showed managed money as buyers of 8,298 corn contracts to be long 199,970. They were sellers of 9,833 soybeans and remain long 98,228. Funds were buyers of 3,837 wheat to trim their net short position to 1,685.
NAFTA negotiations are expected to continue today and tomorrow in Washington, D.C. as Canada's Foreign Affairs Minister Chrystia Freeland visits to continue to the talks.
Funds on Friday were estimated buyers of 6,000 corn contracts, 4,500 soybeans, and 7,500 wheat contracts.
South Korea's President Moon Jae-in said on Monday there could be more impromptu talks and summits with North Korea's Kim Jong Un, as U.S. officials prepare for a historic meeting between President Donald Trump and Kim. Moon and Kim Jong Un held a surprise meeting on Saturday at the border village of Panmunjom, during which they agreed that a North Korea-U.S. summit must be held. (Reuters)
Consumer Confidence will be out this morning at 9:00 AM CDT. Some cattle traders monitor the health of the consumer as a gauge of beef demand.
Dressed beef values were lower with choice down 1.57 and select down .31. The CME Feeder Index is 136.04. Pork cutout value is up 1.49.
If you have any questions on any of our content, give us a call at 800-262-7538 or email@example.com