AgriVisor Morning MarketWatch

Tuesday, December 03, 2019
New month positioning was the primary driver of yesterday’s market. This is now starting to wear off, and the market is again searching for a fresh news story to drive price discovery. As it has been, the longer it takes to find this story the more lethargic trade becomes. We are now seeing more trade news as tensions are building between the US and South America as tariffs are set to be reinstated on steel and aluminum imports from those countries into the US. According to the White House both Argentina and Brazil have been manipulating their currency to give them an advantage in the world market, hurting the US farmer. There are now concerns over what these tariffs will have on the US economy from a manufacturing stand point. There is also an increase in doubt over a favorable trade deal being reached with China ahead of the December 15th deadline for additional tariffs. The US has indicated they would be willing to roll these back but has stopped short of saying all existing tariffs will be dropped which is what China is demanding. Aside from these developments, trade continues to monitor world weather for market valuations. Most of the world is favorable for production at this time, but there are some regions that are being monitored. One is Argentina where soils continue to dry. Another is the Black Sea where some winterkill in wheat could be taking place. For today’s trade, trade will undoubtedly focus on the weekly harvest pace which is at 89% on corn and 96% on soybeans. It is quite possible these numbers may not climb much given current weather conditions across the US.  

* Us harvest slowed from weather
* US to reimpose steel tariffs on SAM
* US may now impose tariffs on France
* President sees no quick end to Chinese trade war
* Dry weather building in Argentina
* Chinese economy better than expected
* USMCA may be approved this week
* Ukraine grain exports +32% on the year
* Export basis softer yesterday

* Corn 89% harvested
* Export demand building
* US harvest to linger into spring
* US higher priced than Russia/Ukraine
* Brazil corn values rising

* Harvest at 96%
* Heavily oversold
* No trade deal progress
* US becomes competitive in global market
* Analysts predict record Brazil crop 

* Argentine crop 80% sold
* Russia may see winterkill
* France to cut acres from excessive moisture 
* Even with issues, global crop is up
* Australia cuts crop by 20% 

* Uncertainty over world trade negotiations
* Cash cattle support futures
* US beef sales up 25% on the week
* US pork sales +44% from year ago
* US pork sales a record; more business still needed