We have finally reached the end of 2020, and for the most part, it would appear that the grain and soy markets plan to finish things off with a bang. For the week, corn is more than 25-cents higher, beans are right at 50-cents higher, and after having its fairy godmother show up to spur on the carriage yesterday, even wheat sits 12-cents higher. It does seem that these markets have finally moved into the price rationing stage, but it is still unknown if enough is enough. When we return from the long New Year’s weekend, we will still be confronted with a touch and go weather situation in South America and a sizeable Chinese appetite, so the uncertainly will almost certainly remain elevatored. That said, we have already advanced significantly over the past twelve months, and in fact, we are set to close out the year at the highest levels since mid to early 2014 in all of these markets—more about this in the weekly letter. As always, though, we should never assume that everything will remain the same.
While none of them will take your breath away, export sales rebound nicely last week. For the week ending the 24th, we sold 520,600 MT or 19.1 million bushels of wheat. This is 32% above the previous week, with top sales going to China at 133.2k MT, followed by the Philippines with 80.9k, and then Vietnam taking 77.5k. Corn sales jumped 48% above the previous week, coming through at 964,500 MT or 38 million bushels. Unknown destinations accounted for 246k MT of these, Japan was in for 117.4k, and Costa Rica bought 102.2k. Bean sales totaled 695,400 MT or 25.6 million bushels, which was up 97% for the week. China was back on top with purchases of 619.7k MT, followed by Egypt at 91.8k and Indonesia with 88.9k. There were reductions of 588.1k by unknown destination, but there were also sales of 315.8k MT for the 2021/22 crop year, of which China accounted for 126k. China was also in this week for 44.3k MT of sorghum for this crop year and 53k for 21/22, combined 56,900 RB of cotton old and new crop years, 114,100 whole cattle hides, 3,100 MT of beef, and a total of 24,300 MT of pork.
The weekly initial jobless claims improved this week as the number dropped 19,000 to 785,000. Granted, this remains far too large, but economists were excepting to have seen an increase of 25,000 for the week
Looking at the macros are we finish out the week/year; we have equities slightly positive, but at what should be record high weekly/monthly/yearly closes, metals are higher, energies lower, financial instrument higher, and the dollar flat. Keep in mind, though, this should be the lowest monthly close in the dollar since March of 2018.
With all of that, we will sign off for the year 2020. We thank you for your business and for taking the time to read the comments we muster together.
Have a Safe and Happy New Year, and we look forward to the next!
