Grain Comments - 02-20-19

Good Morning!

The markets are mixed with corn futures attempting a mild recovery while beans and wheat remain on the defensive. Tuesday’s decline pushed WH9 to the lowest level since Dec 2017 while nearby corn futures traded to an 11-week low. Fundamental news remains bearish as the South American weather pattern remains mostly favorable.

The weather outlook for Brazil has close to average rainfall for most growing regions over the next 5 days with the exception being the far south. The 6 to 10-day forecast looks mostly favorable as well. Argentina will remain mostly dry until the weekend when a front brings rainfall to most of the growing areas; a drier trend resumes before rain chances return by late week.

President Trump hinted once again he may push back a key trade deadline with China. Trump said Tuesday that trade talks with China are going well, adding the current March deadline is not a "magical date." President Trump said U.S. corn sales to China have been part of the ongoing trade discussions. The US is also seeking a pledge from China it will not devalue its currency as pert of the agreement to end the trade war.

EPA acting administrator Andrew Wheeler rejected a proposal from his staff that would have reduced the ambition of the nation’s biofuel policy over the next three years, arguing the targeted range it included for annual ethanol consumption was too low.

The average trade estimate for Friday’s Cattle on Feed Report has the number of cattle on feed as of January 1st at 102.2% of a year ago. Placements in December are pegged at 101.4% and marketed in December are estimated at 99.7% of a year ago.

A Bloomberg survey has 2019/20 corn acres at 91.7 million, soybean acres at 86.1 and wheat acres at 47.2 million. The USDA Ag Outlook Forum begins Thursday which will give the trade its first look at what the USDA believes the acreage mix will look like for next year.

Have a great day!

Wayne Kollis - Melissa Peters - Mike Rosenberg - Matt Zeman - Austin Behrendsen