Good Morning farm country. Davis Michaelsen here with your morning update for Friday, November 17. From Pro Farmer’s First Thing Today, these are some of the stories we are watching this morning:
Corn futures faced pressure overnight, but the market is currently trading mid- to high-range and steady to a penny lower. Soybean futures faced pressure earlier, but the market is currently up 3 to 4 cents. Wheat futures have moved well off overnight lows, but remain in negative territory, with most contracts fractionally to 3 cents lower. The greenback is down slightly, with crude oil futures also under pressure.
One of this year’s major stories is China’s voracious appetite for grain, with some saying the usually self-sufficient country could be the world’s top corn importer in 2020-21. Rebuilding after African swine fever and some weather issues left the country with a domestic grain shortfall far sooner than many expected. Prices of corn, wheat and barley have climbed worldwide, which has helped farmers but also poses the threat of global food inflation next year and could rattle the livestock and dairy industries.
Forecasters expect the U.S. economic recovery to remain on track following the presidential election, with a potential coronavirus vaccine and a new fiscal stimulus package in sight, a new Wall Street Journal survey shows. Economists surveyed see an unemployment rate of 6.7% at the end of this year, down from 7.8% in last month’s survey.
Grocery stores are reinstating purchase limits on items like paper towels or soap for the first time since the spring, as consumers stock up on staples amid rising Covid-19 cases. With people staying at home more, retailers say there is renewed demand for paper products and frozen foods.
China will sign a mega trade deal this weekend with Japan, South Korea, Australia, New Zealand and the 10 ASEAN member countries, wrapping up years of negotiations. The Regional Comprehensive Economic Partnership, (RCEP), which covers 30% of global GDP and trade, aims to reduce tariffs, strengthen supply chains with common rules of origin and codify new e-commerce rules.
Cash cattle prices improved to $109 in the Iowa market yesterday, with trade underway at $110 in Kansas and Nebraska and at $111 in Texas. This marks a notable improvement from last week’s action that largely ranged from $105 to $107. December lean hogs remain at a discount to the CME lean hog index, with efforts to narrow that gap helping the contract to lead gains yesterday. Buying in other contracts was more subdued with traders uncertain about how long strong Chinese pork buying will continue with herd rebuilding well underway.
