Good morning.
Ag trade overnight to start Tuesday has been quiet/higher, with soybean oil being the upside leader. Wheat futures are also recovering most of yesterday’s losses in what looks to be turn-around-Tuesday type trade, as there has been nothing new war-related develop overnight. The higher trade in soybean oil is likely contributed again to the idea that tariffs by the Trump administration, which he confirmed yesterday afternoon, would limit used cooking oil imports and thereby raise demand for domestic soybean oil. Remember, soybean oil had a sharp three-day rally immediately following the election before selling off in the weeks since. Corn futures this morning are trading around a penny lower, soybean futures are trading 2-3 cents higher, and the Chicago wheat market is up 6-7 cents. Products are mixed, soybean meal is down $1-2/ton, and soybean oil is up 1.10-1.20. Outside markets are mixed/higher, crude oil futures are up 40-50 cents/bbl, the Dow Jones index is down 140 points, and the US$ index is near unchanged. The S&P500 is up 15 points, and the NASDAQ is up 50 points.
Most talked about headline in the markets on Tuesday will likely be news that President-elect Donald Trump has doubled down on his tariff pledges, saying in a barrage of social media posts late on Monday that he would be pursuing 25% tariffs on imports from Canada and Mexico beginning on ‘day one’, as well as enacting an additional 10% tariff on top of already existing tariff levels on imports from China.
It is unclear exactly what the tariff level will be on goods coming from China, as Trump previously has talked about a rate in excess of 60%. It would also appear the tariffs on Canada and Mexico would violate a free trade agreement that he negotiated during his first term in the White House. The Canadian dollar dropped to a four-year low on the news, while the peso dropped to its weakest level since 2022.
Private Russian analyst SovEcon cut its wheat export forecast from 45.9 mmt’s to 44.1 mmt’s, citing expectations of stricter export quotas from the government. In recent years, exports have been limited in the second half of the season to protect the domestic market.
The USDA’s Cold Storage report, released on Monday, showed total red meat supplies through the month of October at 882.7 mil lbs., which was down 1.6% from September and down 3.1% from October of last year. Poultry supplies at 1.113 bil lbs. were down 7.5% from last month and down 5.7% from last year.
Equity markets on Tuesday will be mostly quiet again from a data standpoint, with the FOMC minutes from the Fed’s November meeting being the most notable happening today; the minutes are due out this afternoon, and traders will be curious to see if there any clues pertaining to another cut before the end of the year.
Light rains impacted the eastern part of the US on Monday, while the majority of the rest of the country saw mostly dry conditions. Most of northern/central CA also continued to see moisture.
Overnight forecast changes for the rest of the week were minimal; dry conditions continue to be expected through the Thanksgiving holiday and into the weekend, while temperatures are still expected to sharply drop off Wednesday night into Thursday.
Week-two forecasts remain mostly unchanged as well, as dry conditions continue to be forecast through the majority of the country. The Canadian Prairies into the far northern parts of the US and then also the Gulf into southeast TX will be the two areas with precipitation chances into December 10th.
Brazil actually saw one of its drier days in the past month on Monday, as most of the central and southern part of the country was dry; northern areas saw scattered rains of trace amounts to a half inch generally, while heavier totals were seen further towards the east coast. Argentina saw good rains of 4+” in areas north of Buenos Aires and east of Cordoba generally speaking.
Forecasts otherwise remained mostly unchanged, as southern Brazil and Argentina are still expected to receive much better rains through the remainder of this week and into the weekend. 10–15-day maps are slightly drier for most of Argentina than yesterday, but still see heavy rainfall potential in southern Brazil.
Have a great day.
Grain Comments: 11-26-2024
Good morning.
Ag trade overnight to start Tuesday has been quiet/higher, with soybean oil being the upside leader. Wheat futures are also recovering most of yesterday’s losses in what looks to be turn-around-Tuesday type trade, as there has been nothing new war-related develop overnight. The higher trade in soybean oil is likely contributed again to the idea that tariffs by the Trump administration, which he confirmed yesterday afternoon, would limit used cooking oil imports and thereby raise demand for domestic soybean oil. Remember, soybean oil had a sharp three-day rally immediately following the election before selling off in the weeks since. Corn futures this morning are trading around a penny lower, soybean futures are trading 2-3 cents higher, and the Chicago wheat market is up 6-7 cents. Products are mixed, soybean meal is down $1-2/ton, and soybean oil is up 1.10-1.20. Outside markets are mixed/higher, crude oil futures are up 40-50 cents/bbl, the Dow Jones index is down 140 points, and the US$ index is near unchanged. The S&P500 is up 15 points, and the NASDAQ is up 50 points.
Most talked about headline in the markets on Tuesday will likely be news that President-elect Donald Trump has doubled down on his tariff pledges, saying in a barrage of social media posts late on Monday that he would be pursuing 25% tariffs on imports from Canada and Mexico beginning on ‘day one’, as well as enacting an additional 10% tariff on top of already existing tariff levels on imports from China.
It is unclear exactly what the tariff level will be on goods coming from China, as Trump previously has talked about a rate in excess of 60%. It would also appear the tariffs on Canada and Mexico would violate a free trade agreement that he negotiated during his first term in the White House. The Canadian dollar dropped to a four-year low on the news, while the peso dropped to its weakest level since 2022.
Private Russian analyst SovEcon cut its wheat export forecast from 45.9 mmt’s to 44.1 mmt’s, citing expectations of stricter export quotas from the government. In recent years, exports have been limited in the second half of the season to protect the domestic market.
The USDA’s Cold Storage report, released on Monday, showed total red meat supplies through the month of October at 882.7 mil lbs., which was down 1.6% from September and down 3.1% from October of last year. Poultry supplies at 1.113 bil lbs. were down 7.5% from last month and down 5.7% from last year.
Equity markets on Tuesday will be mostly quiet again from a data standpoint, with the FOMC minutes from the Fed’s November meeting being the most notable happening today; the minutes are due out this afternoon, and traders will be curious to see if there any clues pertaining to another cut before the end of the year.
Light rains impacted the eastern part of the US on Monday, while the majority of the rest of the country saw mostly dry conditions. Most of northern/central CA also continued to see moisture.
Overnight forecast changes for the rest of the week were minimal; dry conditions continue to be expected through the Thanksgiving holiday and into the weekend, while temperatures are still expected to sharply drop off Wednesday night into Thursday.
Week-two forecasts remain mostly unchanged as well, as dry conditions continue to be forecast through the majority of the country. The Canadian Prairies into the far northern parts of the US and then also the Gulf into southeast TX will be the two areas with precipitation chances into December 10th.
Brazil actually saw one of its drier days in the past month on Monday, as most of the central and southern part of the country was dry; northern areas saw scattered rains of trace amounts to a half inch generally, while heavier totals were seen further towards the east coast. Argentina saw good rains of 4+” in areas north of Buenos Aires and east of Cordoba generally speaking.
Forecasts otherwise remained mostly unchanged, as southern Brazil and Argentina are still expected to receive much better rains through the remainder of this week and into the weekend. 10–15-day maps are slightly drier for most of Argentina than yesterday, but still see heavy rainfall potential in southern Brazil.
Have a great day.
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