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Today our nation mourns and honors George H.W. Bush, our 41stPresident and truly a statesman and servant of this country. With his passing, we not only lose an outstanding individual and patriot but one more from a group of people who have been correctly identified as the “Greatest Generation.” May he rest in peace.
Talking about markets now almost feels trivial but that is what we do, and the rest of the world and markets move on. As far as the grain/soy trade, moving on translates to softer grain and firmer soy at this time. It seems that the primary supportive factor in beans comes from comments made on the Chinese Commerce Ministry web site. According to the post, they intend to move forward as quickly as possible work out a new agreement. It sounds as if they intend to strike while the iron is hot.
Outside of that, and maybe help from a fractionally weaker dollar, that appears to be the only positive news floating around today. There have been several reports coming out of South America and none of them inspiring for the bull. Brazilian consulting firm Cèleres is projecting that this nation could produce a soybean crop between 123 and 130 MMT this year. This compares with the current USDA estimate of 120.5 MMT. The CEO of the firm, Anderson Galváo, also noted that the truce between the US and China is already pressuring premiums at ports and also commented that El Nino could create production issues in the northern Mapitoba growing region. Also out of Brazil a comment from the CEO of SLC Agricola who speculated that another 43 million hectares (106.25 million acres) could be brought into production in the Cerrado region. As you are aware the Brazilian president-elect, Jair Bolsonaro, leans favorably to expanding agriculture.
Even though the December report will not include any changes to domestic production, the USDA will provide an updates supply/demand estimate as well as estimates for global production and supply/demand. The trade estimate we have seen so far come courtesy of Reuters and break down as follows; Domestic ending stock for corn at 1.738 billion, compared with 1.736 last month. Beans at 945 million versus 955 and wheat at 956 million instead of 949 million. The survey is calling for Argentine corn production of 42.43 MMT (42.5) and beans at 55.72 (55.50) and for Brazil, corn production at 94.41 (94.5) and beans 120.88 (120.50). Finally, world ending stocks are expected to come in at 307.59 MMT for corn (307.51), 112.79 MMT for beans (112.08) and 266.79 MMT wheat (266.71).
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