China
Grains started out mostly lower Wednesday but Darin Newsom with Barchart says they continue to see buying on the dips as funds are covering shorts and taking profits.
Kevin Duling, KD Investors, says it wasn’t the best close for the grains as the markets ran up into some chart resistance and are starting to look a little tired.
Allison Thompson with The Money Farm says a combination of factors drove soybeans higher including South American weather and China economic news. Corn and wheat followed. Cattle futures also made new highs for the move pushed by cash.
Darren Frye, Water Street Advisory, says the 50 basis point interest rate cut by the Fed was anticipated but is friendly for the ag markets.
Kent Beadle, Paradigm Futures, says November soybeans are finally above the 50 day moving average for a number of reasons, including more talk of China business.
The effects are already visible, with declining French barley exports to China and the U.S. struggling to sell corn for the new season.
The government of China has come a long way in developing its agricultural sector over a relatively short period. Since 2000, the real value of China’s agricultural production has increased more than 530 percent.
Reports say China has purchased more than 20 cargoes of feed grain in the past two weeks. Where is China buying from, and what’s behind the sudden surge?
Experts are watching global dynamics to understand the input market’s longer-term outlook in the U.S. Among their top concerns are geopolitics, weather and low supply.
Just this week, China’s largest real estate firm was told it must liquidate after trying to restructure for two years. Some experts say the country is teetering on a recession.