Morning Comments November 21, 2019

Boxholm harvest

Opening Calls

Corn: Steady to .01 higher

Beans: Steady/Mixed

Lack of news is still the theme for the markets as we wait on news for the U.S. and China phase one trade deal along with lackluster demand for corn. The market is hopeful for an improvement in corn export sales as the South American harvest wraps up. Bulls are waiting for the USDA’s January WASDE report with the hope that corn yield will be cut by 1 to 2 bushel per acre. Bears are quick to point out that lower demand could leave the carryout unchanged even with this reduction. Another concern weighing on the markets is the potential size of the 2020 corn crop. 94 million acres with trend line yields would leave us with a 3.0 billion bushel carryout.

The sell-off in soybeans took us below the 100 day moving average which is not positive for beans. Fund liquidation is the main reason as confidence in the trade deal with China is weakening on rumors of problems over tariffs. The spread between the U.S. and Brazilian bean prices has been narrowing which has led to an increase in exports but expect this uptick to last only into January or early February as South American supplies return to the market. The weather forecast for South America has improved and without a trade deal beans will struggle going forward.

As you think about marketing contact your local GMA to discuss marketing opportunities to manage risk and maximize the value you receive for your grain.