Corn and bean bulls have obviously decided, they do not want just Turkey for Christmas, they want to make sure all the trimmings are there, and as long as the table is set, they might as well have prime rib to boot. Both of these markets have extended into higher highs overnight but keep in mind this is occurring on lighter than normal volume and with little in the way of fresh news.
Weekend rains in South America have at least temporarily pushed the weather concerns off of the front burner, but that has been replaced for now with the ongoing port strike in Argentina. Workers at 22 ports have now been on strike for nearly two weeks, and reportedly more than 100 vessels are backed up, waiting to load. This has taken a bit longer than normal to settle, so evidently, workers are a bit more “determinado” to secure better wages and benefits this time around.
This is undoubtedly creating issues for farmers trying to move wheat at this time, but corn and bean planting continues to move forward. According to the Buenos Aires Grain Exchange, 67.8% of beans are now planted, 6.8% behind average, and 55.4% of the corn, which is 5.8% behind the average pace. In Brazil, bean planting is now estimated to be 97.7% complete.
An executive for the Chinese grain company COFCO has stated they expect that nation to import more than 100 MMT of soybeans this year. As you might expect, meal demand is expected to continue growing as the hog industry expands with the rebuild, and bean oil usage is expected to grow 6% not only because of use in feed but via biodiesel demand increases.
We did have a few economic releases this morning, but several were just reconfirming previous reports. The Final GDP and PCE numbers for the 3rd quarter were issued. GDP ended up at a positive 33.4%, which was a slight increase over the preliminary number of 33.1%. The PCE Price index was unchanged from the preliminary at 37%, and the Core PCE number came through at 3.4% compared to 3.5%. Real Sales for the quarter improved to an increase of 25.9% versus 25.6, and Personal Consumption actually grew by 41% compared to the preliminary estimate of 40.6%.
Weekly export sales will be released tomorrow morning and the Quarterly Hog and Pigs report in the afternoon. The trade is expecting to see all hogs to come in at 99% of a year ago, kept for breeding at 98% and kept for market 99%. The Sept-Nov pig crop is expected to slip 3% from last year.
Looking over at the macros this morning, we find financials higher, metals and energies lower, equities lower and the US Dollar strong.
