Early Market Talk

Low trade volume continues with under 8K trading on corn and soybean lead contracts. At 0600 CH19 1 ¾ higher at $3.79 and SH19 1 ½ higher at $9.20 ½. KC and Chi wheat both higher as well.

Dow futures 122 higher at 24,675. Crude .50 higher at $53.81. US $ Index just below unchanged.

Advertised cold weather has arrived. Des Moines at negative 18 this morning. Good news, the negative 30 degree record low set January 5th, 1884 looks safe.

Farmer selling remains limited and basis firming at several end user locations. First time since early December we’ve seen some basis “packages” being sold into forward months.

Well followed analysts out of Illinois putting this year’s soybean acres at 85.7 mln. Would be down 3.4 million from a year ago and the second largest year/year drop since 2000. Largest drop was 10.8 mln acres from 06 to 07. Will take
a closer look at acreage changes later this morning.

CFTC to stagger / catch up with weekly commitment of traders reports so will take some time to get current. Last report we saw had Funds net long 124K corn and 13K soybeans. Our guess today has Funds long a net 102k corn and near even soybeans. Since the last CFTC report corn is down about 8 cents and soybean near 2 cents.

Dry conditions largely prevail over Brazil in the near term with a pattern shift indicated on longer term maps. Getting close to the point rainfall in Brazil or lack of is no longer an issue for soybean production. Safrina corn another matter.

Day two of trade talks between US and Chinese trade officials. Treasury Secretary Mnuchin quoted as expecting “significant progress” before tariffs are set to ratchet up next month.

Article Written by:
Bruce Nelson