E-Visor Reports: Market Watch

Monday, November 30, 2020
Widespread rains moved through several regions of South America over the weekend, putting pressure on overnight trade. Long range forecasts still indicate drier than normal conditions for the next two weeks, but thoughts are these rains will at least minimize crop loss at this time. The majority of today’s session will be spent getting final month end positions in place. This will be more of a factor on December corn and wheat as those contracts go into delivery. The fact that many positions have already been rolled to the deferred months may limit activity in the spot contract. Heavier trade volume is expected this week as participants return from the Thanksgiving Holiday. We will continue to see attention on South American weather this week as conditions in several regions remain in drought conditions. Not only is this an issue on current developing crops but those that were reseeded as well. As a result, several forecasters have started to back off their initial yield estimates. While this year’s soybean production in Brazil is still likely to be larger than last year and a record sized crop, it may not be enough to replenish the world supply as much as hoped. 

* Widespread weekend rains in Brazil
* US market cheapest for feed grains
* All interest in SAM on December outlooks
* Low Dec precip could cut crops considerably
* Argentine farmers not selling inventory, or new crop
* IL River now open for barge traffic
* Trade waiting for Chinese trade confirmation
* Delays to Covid vaccine timeline a concern
* US unemployment remains a concern
* First notice day on Dec contracts is today

* 20/21 ending stocks may decline to 1.5 bbu
* Carryout likely steady through next year
* China corn remains record high
* US feed demand rising
* Corn/Wheat spread narrows
* True ending stocks close to 100 mbu 
* Ending stocks will struggle to build
* Global oilseed needs rationing
* Crush margins keep basis firm
* Canola futures at 7 year high
* SW US drought remains a concern
* Wheat balance sheets not a concern
* Australian crop could reach 34 mmt
* Most analysts peg Australian wheat at 30 mmt
* China sees few buyers in weekly auctions 
* Technical buying supports cattle
* Dry plains to keep cattle in lots longer
* Concerns build over spring conditions
* Stimulus package hopes support cash markets
* Chinese pork demand questioned

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