Early Market Talk March 6, 2020

Emtheader

At 0600 markets under pressure as uncertainty toward Corona virus economic impact persists. C20 trading off 2 ¼¢ at $3.79 ½ with SK20 4¢ lower at $8.93. For the week corn up 11 ¼ with soybeans now 1¢ lower.

Dow futures smacked another 553 points this morning at 25,514. Still higher for the week. Crude oil off $2.16 at $43.78 making a new low for the move. Crude trading the lowest level since December of 2018.

Confirmed that China will issue duty free import licenses that are good for a year. While good news, the “Market Competitiveness” wording in the trade agreement haunts. If China needs soybeans, the US likely won’t see that in a meaningful way until fall. Something about 6.5 billion bushels of beans in South America soon to be harvested.

Export sales totals yesterday all on the low side of expectations and suggest USDSA too high with current forecasts for the 19/20 crop year.

No corn deliveries against CH20 again overnight. Open interest down to 2,797 contracts with the CHCK at a 3¢ inverse. CKCN influenced as well trading 2¢ this morning.

Coronavirus infecting near 100K worldwide with over 3K deaths. Deaths in the US from the virus stand at 13.

Some best of year soybean values trading yesterday at select processors.

Taking Ag Outlook balance sheets at face value, corn needs to give up acres to soybeans. With a soy / corn ratio of 2.3 that’s doubtful? Soybeans expected to gain on corn.

Ending the week with continued worldwide economic activity……

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