Good Morning from Allendale, Inc. with the early morning commentary for November 20, 2019.
Grain markets are mixed overnight on slightly lower than expected harvest completion, wet weather maps in the 6-10 day outlook and renewed optimism a USMCA trade deal might be finalized soon. Traders will continue to keep a close eye on these factors as producers struggle to complete this year’s harvests.
USDA confirmed U.S. exporters sold 191,000 tonnes of corn to an unknown destination during the 2019/20 marketing year. This is the second day in a row of corn export sales.
The U.S. has reached an agreement ensuring the largest ever volume of guaranteed market access for U.S. rice exports to South Korea, U.S. Trade Representative Robert Lighthizer and Ag Secretary Sonny Perdue said. Under the agreement, South Korea will provide access for 132,304 tons of U.S. rice annually at a value of about $110 million, Lighthizer's office said. South Korea also agreed to important disciplines to ensure transparency and predictability around the tendering and auctioning for U.S. rice, it said. The agreement will enter into force on Jan. 1, 2020.
The U.S. will raise tariffs on Chinese imports if no deal is reached with China to end a trade war, President Trump said. "If we don't make a deal with China, I'll just raise the tariffs even higher," he told a room filled with senior U.S. officials.
Hong Kong has allowed imports of Russian poultry from all of Russia's regions, Russia's food safety watchdog said. They added, 20 Russian producers currently have the right to supply their poultry to Hong Kong.
Thousands of workers at Canada's largest railway, Canadian Pacific Railway went on strike for the first time in a decade, disrupting shipments of commodities and sparking calls for Prime Minister Trudeau's government to intervene. Roughly 3,000 unionized workers, including conductors and yardmen from CNR hit picket lines gathered, after both sides failed to resolve contract issues at a time of softening demand for freight service.
President Trump accused Speaker of the House of Representatives Nancy Pelosi of delaying a vote to approve the USMCA trade pact between the U.S., Canada and Mexico in order to secure support for her impeachment inquiry. Since the inquiry began hostility has built between her and President Trump, with Pelosi leaving an Oval Office meeting last month saying Trump had insulted her.
Cattle on Feed and Cold storage reports (for October) will be released this Friday at 2 p.m. CDT. Typically, this report will show the largest placement month numbers of the year. Allendale sees placements at 2.163 million head (3.8% under last year). The average guess from the other nine analyst on Bloomberg's poll comes out to 10.8% over last year. Allendale sees marketings 0.1% under last year (0.4% under is the average guess). On Feed seen at 1.8% under last year according to our numbers (1.1% over is the average guess).
Cold Storage estimates have October beef stocks seen around 465.940 million lbs. (2 million lb. increase over September). The five-year average is a 9 million increase from September.
Dressed beef values were lower with choice down 0.11 and select down 0.12. The CME feeder index is 146.54. Pork cut-out values were down 4.47.