Morning Comments December 5, 2018

Opening calls:

Corn down 1 to 2 cents

Soybeans up 2 to 4 cents

 

Good morning!

 

December corn closed up 3 cents on Tuesday at $3.74 1/4. Trade seems to go back and forth on optimism about the effect of the truce between the U.S. and China. Remember, there is only a 90 day window for resolution at this point and many are concerned it won’t be enough time to reach an agreement. There is also some confusion about when the 90 days start, Dec 1 or Jan 1. We are seeing grain export shipments resume out of the Ukraine, and basis levels out of the Black Sea region are at or slightly above the U.S. Gulf. South America’s weather remains favorable for planting, with both Brazil and Argentina being ahead of last year and the average pace.

 

January soybeans finished yesterday’s trade 6 cents higher at $9.11 ¾, again primarily supported on trade optimism with China. However, we have not seen any hard numbers come out of what this could do for U.S. soybeans. The other big question has been, with the new truce, will U.S. soybean producers see the other half of the $1.65 payment. At this point it sounds promising, but we are supposed to see more details by the end of the week. Looking at South America’s planning progress, Brazil is 95% planted, well ahead of last year and the average. Argentina is lagging slightly at 47% planted, vs. the 50% average.

 

Reminder: Due to President Bush’s Memorial today, certain government offices will be closed and several reports will be delayed this week including EIA ethanol data and USDA’s export sales. However, the Board of Trade will be open for regular hours today.