Grain futures are lower in overnight trading:
Corn – 5 ½ cents/bu (Mar @ 3.82)
Soybeans – 3 ¼ cents/bu (Mar @ 9.25 ¾ )
Chi Wheat – 9 cents/bu (Mar @ 5.64 ¼ )
Cdn $ unchanged (76.68 cents)
WTI Crude Oil -0.20/barrel (57.61)
Grains initially tried to trade higher in the overnight session, with cereals just slightly above unchanged and soybeans up a penny and a half. However, any strength was short lived, as concerns over the lack of concrete details in the Phase One Trade Agreement have led to sellers becoming more aggressive. Over the past 6 weeks, selling has been muted by the “what if” proposition of China buying big quantities of USA grains. However, the deal as written does not appear to have significant consequences if China fails to buy the dollar values indicated, and the lack of specific commodity quantities in what was released is being viewed negatively. The fact that the deal specifically references that purchases are subject to “market conditions” as a potential out for China to miss it’s dollar value purchases has the trade questioning what the deal really means.
Having said all that, USA equity futures seem to like the deal, with the Dow futures currently up anther 71 points @ 29.100.
USDA Weekly Export Sales Report is due out later this morning. The trade is not expecting big volumes of sales in the report. If realized, poor sales may encourage sellers more. We can only hope for some unforeseen sales to be reported!
Argentina got some rains in it’s northern geography yesterday, but overall forecasts remain dry. Brazil is still wet.
There will be no midday market commentary issued today, as I will be at the Forest Curling Club @ the Wanstead Farmers 1st Annual Curling Bonspiel. Thank you to everyone that signed up to come out. See you all at 9:30 am!!!