If you would like to receive our technical comments including price projections and cycle analysis for important tops and bottoms, click on the link at the bottom of the commentary to sign up for a 30-day free trial subscription. Follow Ag Watch Market Advisors on Facebook and Twitter for timely information not posted in our blog.
Corn is like a ship without a rudder. Stocks are declining but so is demand. Exports are horrendous, and a carryout of 1.9 BB is more than adequate to meet usage. Meanwhile, no production threats are on the horizon in South America. That said, the bulls may be content to stay in their pen until the January Crop Report. In other developments, export inspections were better than expected at 22.0 MB. This was the second highest of the season but is well short of the 39.9 MB needed to be shipped each week to reach USDA’s target of 1.850 BB. Currently, we are on track for 892 MB. Looking at harvest, it continues to creep along at 66 percent complete versus the average of 85 percent. North Dakota is behind the most at 61 percent below its average.
Traders are losing patience in getting an agreement inked with China as evident by the sell-off in soybeans this week. For months, their emotions have been running high in expectations of a deal. However, news of signing an agreement has run hot and cold in the past. Meanwhile, Brazil’s planting is 58 percent complete versus the average of 57 percent and is accompanied with improving weather. In other developments, exports remain strong with inspections last week of 48.9 MB. China took 28.0 MB. Keep in mind that exports generally peak by the third week of November and can fall as much as 60-80 percent. Looking at harvest, it is 85 percent complete versus the average of 92 percent. Meanwhile, North Dakota lags its average by 24 percent.
There is not a great deal of fresh news in wheat as winter wheat planting is winding down and global stocks are at a record. Fifty-four percent of the crop is in good-to-excellent condition, down 3 points from the previous week. Dry weather continues in Australia, but it has not been a great concern. While the USDA left U.S. exports unchanged at 950 MB, we will face plenty of competition from the EU, Russia, and Ukraine as their exports were raised 2.0 million tons. Last week, inspections were higher than expected at 19.4 MB and above the average of 18.2 MB that must be shipped each week to achieve USDA’s target of 950 MB. Currently, we are on track for 950 MB.
Want the kind of intel that helps serious producers succeed? Sign up for a FREE! trial subscription to our daily newsletters.
Comments and suggestions are provided for information purposes only. Information contained herein is obtained from sources believed to be reliable but not guaranteed to its accuracy or completeness. Readers using the information contained herein are responsible for their own actions. No presentations can be made that recommendations will be profitable or that they will not result in losses. This information is neither an offer to sell nor solicitation to buy of the commodity futures mentioned herein. The writer may be trading in the commodities mentioned.