Early Market Talk March 12, 2020

Emtheader

Dow futures off another 1,000 points overnight and into new low ground for the move. NCAA tournament, no fans. NBA season, suspended. Travel from Europe suspended. Colleagues and I told yesterday to prepare towork from home.

Ag markets hammered as well overnight. At 0600 CK20 off 4¢ at $3.70 ½ with SK20 12 ¾¢ lower at $8.60 ¾. Volume on lead contracts at 27 corn and 31K soybeans. Chi and KC wheat 9 and 6¢ lower respectively.

Dow futures at 22,392 off 1,181 points. Dow inside 1,000 points of the Dec ’18 low. Dow futures have given up 25% since making all time highs a month ago. Crude off $2.00 this morning at $30.98 and shows a 50% decline since the start of the year. Saudis planning to increase daily production to 13 mln brls / day in escalating price war with Russia.

CBOT data shows 106 contracts of corn delivered overnight. ADM house the stopper with JP Morgan and ADM IS customer delivering. CH20 off the board Friday.

Significant amount of bean basis sales made around the country yesterday. Most at best of season levels. A year ago this date, discussion started on carrying old crop beans into new crop. SNSX trading a 20-cent carry that ultimately hit 28¢. SNSX spread today 7 ½¢.

March 31st acreage guesses will start to come out of the woodwork in the coming days. Ag outlook had corn acres up 4.3 mln and soybean acres up 8.9 mln. If March soybean acres fall significantly short of that increase it could get interesting.

Markets looking to discount a worst-case scenario before calm returns.

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