Good morning.
And welcome to the beginning of the holiday trading season. Much like was the case last week, markets are mixed to start Monday’s trade with the feed grains lower and the soy complex higher. Soybeans had a gap-higher open to the overnight session last night, though there doesn’t seem to be a specific fundamental reason present for the pop this morning. Increasing volatility and decreasing volume, as well as risk-off trading towards the end of the week, are likely to be the main themes for the next few days, with the closure of markets Thursday for the Thanksgiving holiday likely to produce a low-interest/choppy half day of trading on Friday. Risk management will be the name of the game. Corn futures this morning are trading 2-3 cents lower, soybean futures are trading 2-4 cents higher, and the Chicago wheat market is down 8-9 cents. Products are higher, soybean meal is up around $2-3/ton, and soybean oil is up 30-40 points. Outside markets are mixed, crude oil futures are down 10-20 cents/bbl, the Dow Jones index is up 300 points, and the US$ index is down 50-60 points. The S&P500 is up 30 points, and the NASDAQ is up 115 points. All three major stock index futures also had a gap-higher start to Sunday night trade, while the $ index gapped lower. Gold futures are $25-30/oz lower.
Friday afternoon’s CFTC commitment of traders report showed as of Tuesday, November 19th, managed money traders were net-long 14,628 contracts of corn (+4,638 on the week), net-short 67,701 contracts of soybeans (-13,166), and net-short 51,546 contracts of Chicago wheat (-6,239).
In soy products, managed money traders are now seen net-short 63,700 contracts of soybean meal (-36,070) and are seen net-long 56,060 contracts of soybean oil (-19,084).
Also, out after the markets closed on Friday was the USDA’s Cattle on Feed report for the month of November. The report showed the on-feed cattle herd as of November 1 at 11.986 mil head, which is just fractionally higher than last year; placements in October totaled 2.286 mil head, while October marketings were seen at 1.845 mil head.
Along with Cattle on Feed, the USDA also released its monthly Chicken and Eggs report on Friday, which showed US egg production in October at 9.19 bil eggs, which was up 4% from September but down 4% from the same month last year.
Russia’s deputy Prime Minister over the weekend said he expects Russian grain exports in the season that began July 1 to reach 55-60 mmt’s, which would be down from 72 mmt’s of exports in the 2023/24 season. He cited lower production due to adverse weather as reason for the decline.
US federally inspected beef production in the week ending November 23rd was seen at 547 mil lbs., which was up 4% from last week. Pork production at 550 mil lbs. was down 2.6% from last week. YTD beef production is down just 0.1% from last year, and pork production is up 1.7%.
In what will also be a holiday-shortened week in US equity markets, the main data point for the week looks to be Wednesday’s PCE inflation update, which is the Fed’s preferred inflation gauge; economists see the reading coming in slightly higher than last month at 2.3% on annual basis.
Wednesday’s data slate will be busy in general due to the holiday, with regular weekly jobs data normally scheduled for Thursdays pushed forward a day. Wednesday will also see durable goods orders for October, as well as GDP data and pending home sales. The week also see FOMC minutes released from the November meeting on Tuesday.
Action in the financial/currency markets this morning is the mostly the result of Donald Trump’s appointment of Scott Bessent as Treasury Secretary over the weekend, whom the market sees as a more moderate candidate. Bessent has said in interviews that his priorities will include enacting Trump’s tax cuts, as well as introducing tariffs and cutting spending.
Snow continued to fall in the northeast over the weekend, and also in the PNW and broader northwest; totals in parts of PA/NY reached 10+”, while similar totals were seen at elevation through parts of the Appalachian Mountains in WV. In the west, heavy snow fell at elevation in the northern Rockies, while most of northern MT into the Canadian Prairie received anywhere from 2-8″ generally speaking.
Forecasts for this week show snowfall mostly limited to areas at elevation in CO/UT, and also in the Sierra Nevada’s in northern CA, though the northeast expects to see limited additional snows over the next five days. Otherwise, light rains are possible in the east early this week, while better rainfall chances are seen in the southeast for Thanksgiving and into the end of the week. The central part of the country looks to remain mostly dry.
Week-two forecasts are in better agreement coming out of the weekend than they were to end last week; all four of the output solutions see a drier bias for almost the whole of the country December 3rd-9th, while the northern Plains and areas of far southeast TX into the Gulf are the only wetter areas; northern moisture will be mostly snowfall, while moisture in the Gulf will obviously come in the form of rain.
The weekend saw a brief shot of warmer air move through the Midwest, though heat this week will be limited to just the south and the southwest; temperatures look to drop to well below normal levels throughout most of the rest of the country beginning Wednesday/Thursday, and will likely remain that way well into December for the eastern half of the country. Western ridging allows temps here to turn warmer beyond this week.
Forecast for South America this week shows good rains possible in central/northern Argentina beginning in the next 24 hours, while southern Brazil also looks to receive rains from this system. South-central Brazil will see a few days of marginally drier conditions this week, while northern areas continue to see normal rains.
The 10-15 day period sees heavy rains impacting southern Brazil and possibly stretching into northeast Argentina, while the rest of Argentina will again turn drier; normal/above normal rains are seen for the rest of Brazil’s growing areas in the same period, as the forecast here continues to see little/no threats into the second week of December.
Have a great day.
Grain Comments: 11-25-2024
Good morning.
And welcome to the beginning of the holiday trading season. Much like was the case last week, markets are mixed to start Monday’s trade with the feed grains lower and the soy complex higher. Soybeans had a gap-higher open to the overnight session last night, though there doesn’t seem to be a specific fundamental reason present for the pop this morning. Increasing volatility and decreasing volume, as well as risk-off trading towards the end of the week, are likely to be the main themes for the next few days, with the closure of markets Thursday for the Thanksgiving holiday likely to produce a low-interest/choppy half day of trading on Friday. Risk management will be the name of the game. Corn futures this morning are trading 2-3 cents lower, soybean futures are trading 2-4 cents higher, and the Chicago wheat market is down 8-9 cents. Products are higher, soybean meal is up around $2-3/ton, and soybean oil is up 30-40 points. Outside markets are mixed, crude oil futures are down 10-20 cents/bbl, the Dow Jones index is up 300 points, and the US$ index is down 50-60 points. The S&P500 is up 30 points, and the NASDAQ is up 115 points. All three major stock index futures also had a gap-higher start to Sunday night trade, while the $ index gapped lower. Gold futures are $25-30/oz lower.
Friday afternoon’s CFTC commitment of traders report showed as of Tuesday, November 19th, managed money traders were net-long 14,628 contracts of corn (+4,638 on the week), net-short 67,701 contracts of soybeans (-13,166), and net-short 51,546 contracts of Chicago wheat (-6,239).
In soy products, managed money traders are now seen net-short 63,700 contracts of soybean meal (-36,070) and are seen net-long 56,060 contracts of soybean oil (-19,084).
Also, out after the markets closed on Friday was the USDA’s Cattle on Feed report for the month of November. The report showed the on-feed cattle herd as of November 1 at 11.986 mil head, which is just fractionally higher than last year; placements in October totaled 2.286 mil head, while October marketings were seen at 1.845 mil head.
Along with Cattle on Feed, the USDA also released its monthly Chicken and Eggs report on Friday, which showed US egg production in October at 9.19 bil eggs, which was up 4% from September but down 4% from the same month last year.
Russia’s deputy Prime Minister over the weekend said he expects Russian grain exports in the season that began July 1 to reach 55-60 mmt’s, which would be down from 72 mmt’s of exports in the 2023/24 season. He cited lower production due to adverse weather as reason for the decline.
US federally inspected beef production in the week ending November 23rd was seen at 547 mil lbs., which was up 4% from last week. Pork production at 550 mil lbs. was down 2.6% from last week. YTD beef production is down just 0.1% from last year, and pork production is up 1.7%.
In what will also be a holiday-shortened week in US equity markets, the main data point for the week looks to be Wednesday’s PCE inflation update, which is the Fed’s preferred inflation gauge; economists see the reading coming in slightly higher than last month at 2.3% on annual basis.
Wednesday’s data slate will be busy in general due to the holiday, with regular weekly jobs data normally scheduled for Thursdays pushed forward a day. Wednesday will also see durable goods orders for October, as well as GDP data and pending home sales. The week also see FOMC minutes released from the November meeting on Tuesday.
Action in the financial/currency markets this morning is the mostly the result of Donald Trump’s appointment of Scott Bessent as Treasury Secretary over the weekend, whom the market sees as a more moderate candidate. Bessent has said in interviews that his priorities will include enacting Trump’s tax cuts, as well as introducing tariffs and cutting spending.
Snow continued to fall in the northeast over the weekend, and also in the PNW and broader northwest; totals in parts of PA/NY reached 10+”, while similar totals were seen at elevation through parts of the Appalachian Mountains in WV. In the west, heavy snow fell at elevation in the northern Rockies, while most of northern MT into the Canadian Prairie received anywhere from 2-8″ generally speaking.
Forecasts for this week show snowfall mostly limited to areas at elevation in CO/UT, and also in the Sierra Nevada’s in northern CA, though the northeast expects to see limited additional snows over the next five days. Otherwise, light rains are possible in the east early this week, while better rainfall chances are seen in the southeast for Thanksgiving and into the end of the week. The central part of the country looks to remain mostly dry.
Week-two forecasts are in better agreement coming out of the weekend than they were to end last week; all four of the output solutions see a drier bias for almost the whole of the country December 3rd-9th, while the northern Plains and areas of far southeast TX into the Gulf are the only wetter areas; northern moisture will be mostly snowfall, while moisture in the Gulf will obviously come in the form of rain.
The weekend saw a brief shot of warmer air move through the Midwest, though heat this week will be limited to just the south and the southwest; temperatures look to drop to well below normal levels throughout most of the rest of the country beginning Wednesday/Thursday, and will likely remain that way well into December for the eastern half of the country. Western ridging allows temps here to turn warmer beyond this week.
Forecast for South America this week shows good rains possible in central/northern Argentina beginning in the next 24 hours, while southern Brazil also looks to receive rains from this system. South-central Brazil will see a few days of marginally drier conditions this week, while northern areas continue to see normal rains.
The 10-15 day period sees heavy rains impacting southern Brazil and possibly stretching into northeast Argentina, while the rest of Argentina will again turn drier; normal/above normal rains are seen for the rest of Brazil’s growing areas in the same period, as the forecast here continues to see little/no threats into the second week of December.
Have a great day.
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