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It seems that were it not for negative news; there would be no news at all in the grain markets this week. Good harvest weather in the U.S. as well as good planting weather/progress in South America and a quick settlement with the Argentina trucker strike. The ever-present trade war storm clouds overhead and now this morning, sluggish export sales, and this for a second week in a row. If we have a choice, I suspect most would have opted for no news, but we know that is not it works and understandably grain and soy markets have worked lower.
As far as the sales, for the week ending October 18thwe sold a pitiful 212,700 MT or 7.8 million bushels of soybeans. The trade was looking for something in the 300 to 700k MT range. Were this late July that may be acceptable but during the early weeks of a marketing year we should be posting solid numbers and needless to say, these were not. The top purchaser was Egypt at 111.3k MT, followed by Taiwan with 99.9k and then the Netherlands with 93.5k. There were reductions of 530,200 MT from unknown destinations and 60k MT from China. Corn sales left much to be desired as well coming in at 349,500 MT or 13.76 million bushels. The trade was looking for a number between 400 and 750k MT. As is so often the case, Mexico was the top purchaser with 275.8k MT followed by Colombia at 208.5k and then Honduras taking 47.8k. There were reductions totaling 293.5k MT from Unknown, South Korea, and Vietnam. Finally, we have wheat, and while we have not seen this often in recent times, posted bigger sales that either corn or beans. Total sales came to 442,600 MT or 16.27 million bushels. This was 7% below last week and the 4-week average but did at least fall within trade expectations of 250 to 500k. Unknown destinations were on the top of the list with 175.2k MT followed by Mexico at 84.8k and then Italy for 52.5k.
With things getting a bit testy in the equity market world, here is one more commodity that probably should be added to the “needs to be watched” list; Gold. If you have read my newsletter for any length of time you would know that I am certainly not a “gold bug” and believe far too often those who are become blinded by its shiny lure, but there is also no denying that when economic uncertainty builds, traditionally many will turn to gold as an alternative. As with many commodities right now, sans energy, gold has swung down toward the lower side of its 4 to 5-year congestion pattern but with the stock market turmoil of the past several weeks have seen a nice upturn. Weekly indicators have now turned positive as well. I am a little surprised that the bounce has not been a bit stronger and maybe the “doom and gloomers” are looking toward new havens such as crypto-currencies, but it would appear that gold has stuck in a bottom and will be just one more commodity making the entire sector more attractive for investment are we move into 2019. Rising tide lifting boats and all of that.
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