AgriVisor Morning MarketWatch

Monday, December 02, 2019
Much of today’s session will be spent with traders establishing their new month positions. The December grain contracts are now in the delivery period placing more emphasis on the March contracts. We will also start to see more interest placed on the December supply and demand report. Typically, the December WASDE released receives little attention, but in a market that is starved for fresh news, that may change. Only the demand side of data is revised in December, but there are some thoughts this may need to be altered this year. The USDA cut crush in the November report although we have seen record usage since. We have also seen a rebound in ethanol manufacturing. That said, we continue to see worries over current and future export demand on both corn and soybeans. We will gradually start to see a shift in trade focus throughout the month of December as quarter and year end start to drive the market attitude. It is not uncommon to see volatility increase as this happens, creating favorable pricing opportunities. We can also see elevated cash grain movement during the month of December as farmers try to shore up cash flow balance sheets. One factor that has and will continue to drive the cash market is the Market Facilitation Program payment and how these are deterring selling incentives. This may give us a stronger than usual cash commodity market into year end. 

* USDA increases net farm income forecast
* US to reimpose steel tariffs on SAM
* World oil production to slow
* Little harvest progress expected this week
* Chinese economy slows
* Trade starting to focus on WASDE
* US ethanol production rebounding
* US/China trade relations remain strained
* Dec 15th tariff deadline approaching

* Buyers looking for optional origin corn
* Brazil exports up 80% from year ago
* Smaller Ukraine, larger Russian crops
* Corn may remain in fields until spring
* EU raises corn crop estimate

* Record soy crush expected for October
* Gulf basis remains firm
* Chinese trade uncertainty
* Brazil soy crop estimated at 124 mmt
* Export sales remain strong 

* Large global supply
* French crop rating declines
* Russia/EU lower crop forecast 
* Damage to US crops
* Drought cuts Argentine production

* Rabobank; Beef production to slow in 2020
* 2019 beef sales at 17,600 mt
* 2020 beef sales last week at 9,100 mt
* 2019 pork sales at 25,600 mt
* 2020 US pork sales at 24,900 mt