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Well, the December supply/demand report has now been relegated to the history books with very little fanfare. Domestic corn ending stock were lowered 50 million from last month (2%) via higher ethanol usage, bean ending stocks we increased 20 million (4.7%) with a cut in exports and wheat stocks were bumped up 25 million (2.7%) with a like cut in exports. Of course, the figure that I know most of you have been anxiously awaiting, oats ending stock were left unchanged at 30 million. Let us not forget though that this number is down 40% from last year. Of course, the question that now begs to be asked is, what will we talk about between now and January?
Well, first on the agenda is the Federal Reserve which will conclude its December meeting later today, with the market fully expecting a 25-basis point hike in the Fed Funds rate. Of course, if that is true it would be just about as shocking to the financial markets as was the USDA report yesterday. Actually, what the market will be most interested in will be the accompanying comments about inflation, unemployment, and projections for economic growth moving forward. Yes, we will have a new chairperson, Jordan Powel, come February but as a member of the board, his views and votes have aligned with Ms. Yellen so little change is expected in the cautious approach that the Fed has implemented. 10-year notes have not quite returned to the same levels we were at to begin the year, but one has to believe any hikes today have been well factored into this market.
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