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January 13th - Midday Market Commentary

01/13/2020
January 13th - Midday Market Commentary

Grain prices are mixed at midday:

Corn + 3 ¼  cents/bu (Mar @ 3.89 )

Soybeans – 3  cents/bu (mar @ 9.43 )

Chi Wheat – 2 ½ cents/bu (Mar @ 5.62)

Cdn $ +0.00060 (76.635 cents)

WTI Crude Oil -0.58/barrel (58.46)

In general, commodity markets are slightly weaker today, while USA equities trade slightly higher.  No major news releases so far today, but optimism over Chinese/American trade relations continue to provide underlying support to markets.  Preparations continue for Wednesday’s signing at the White House of the Phase One Trade Agreement with China, and to that end, wire services are reporting this morning that the USA will remove the “currency manipulator” tag from China ahead of the deal signing.  Ultimately, the market will need to see evidence of increased Chinese purchases in order to move dramatically higher, as grains have already enjoyed a significant upward pop in the past 6 weeks.

Corn is said to be benefitting from some inter commodity spreading this morning (ie buying of corn futures, and selling of beans or wheat futures), but it feels like there is some corn business being done as well that is independently supporting the market.  Hopefully we will see some evidence of some export business in USDA daily “flash” sales confirmations in coming days.

This morning, the USDA released it’s Weekly Export Inspection Report.  Shipments were within the ranges of trade expectations, but continued to show that the USA is far behind the pace needed to meet the current USDA projected export sales totals.  Of the 41.8 million bushels of soybeans shipped last week, 15.2 million bushels were destined for China.  Today’s cumulative year to date shipments show corn shipping to be 148 million bushels (8%) behind the pace needed to hit the annual target, while soybean shipping is 131 million bushels (7%) behind the pace needed.  Soft Red Winter Wheat shipping is actually 6 million bushels (6%) ahead of the pace required to hit the USDA’s projections.  Actual data is listed below, in millions of bushels:

                                Actual                   Expectations                      Last Week           10 Week Average

Corn                        18.1                         17.7 to 25.6                               21.7                           20.2

Soybean                 41.8                        18.4 to 40.4                               38.2                         50.5

Wheat                     17.4                         11.0 to 18.4                                 15.5                          15.7

This Thursday, Wanstead Farmers will be hosting a “Farmer Funspiel” at the Forest Curling Club from 9:30 am through 2:30 pm.  There will be curling games, draw to the button seed prizes, a delicious pulled pork lunch, and a lot of fun to be had by all.  Admission is free.  Thank you to all who have registered already.  We will be putting the teams together tomorrow afternoon, so please call one of our offices right away, if you are interested in attending.

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