Morning Markets: Corn: +1.75 old & +1 new.
Beans: +5.50 old & +4.25 new. Wheat: +5.
MARKET SUMMARY:
Good morning. Markets are higher again this morning in a continuation of the buying seen on Wednesday, with the outside markets in the energy and metals sectors again being the catalyst for what has been an overall 'risk on' trading environment the last couple sessions. Aside from biofuels policy, which we've seen nothing new on this morning, traders are more or less comfortable with where ag prices are given the current fundamental landscape, and this has turned attention in a lot of cases to the macro world this week. Corn futures to start Thursday are trading 1-2 cents higher, soybean futures are trading 6-7 cents higher, and the Chicago wheat market is trading 5-6 cents higher.
Crude Oil is up $2.99 at $66.20
US Dollar is down at $96.22
Dow futures are down 34 points at 49,133
WEATHER:
- High pressure across the western US remains the dominant feature in the forecast heading into the end of the week, with there being little to no signs of a pattern shift occurring anytime soon. This ridge allows northwest flow to continue into the US almost entirely unabated, which is one of the main factors in keeping the eastern and central parts of the country on the drier side of normal. However, this flow is going to allow a system to drop down and meet up with moisture from another smaller disturbance coming out of the Gulf, which will become the winter storm system we've talked about all week for the East Coast that drops through the southeast and then turns and veers back north through the weekend.
- South American forecasts this morning are again little changed from yesterday, and continue to show regular rainfall through the western part of Argentina through the weekend and into next week with abating heat beyond the next couples days. To the north in Brazil, heat is expected to continue not being much of a factor at all, while rains are likely to remain regular across most all the country, especially in the central and east-central parts that have been drier over the past couple weeks.
OTHER HEADLINES:
- Outside markets have remained extremely volatile in a lot of cases overnight, with crude oil futures up around $1.50/bbl, gold futures up another $200+/oz, and copper up nearly 6.5%. In part, the rally is due to ongoing hostilities between the US and Iran, which seem to be intensifying, but also has to do with a sharply lower dollar index over the past couple weeks as a result of Fed policy and comments from President Trump. The metals markets have the makings of a blow-off top being formed, but we have little insight today as to where the run in futures might stop.
- On the Iran front, Trump said on Wednesday that he was weighing options on the situation that included military action against the Middle Eastern country, saying that potential strikes on military targets and security force leaders could occur as a means to inspire renewed protests. In short, the people of Iran have, in recent weeks, began standing up to harsh economic conditions and poverty brought on in large part by government policy, but the government has responded with force; estimates have the civilian death toll ranging anywhere from 5-6,000 to upwards of 30,000.
- Senate Majority Leader John Thune said Wednesday that there remained a path forward to avoid another government shutdown this weekend, expressing cautious optimism that some sort of agreement could still be reached between Democrats and Republicans on issues like ICE enforcement and DHS funding. The current funding bill is set to expire at midnight tomorrow night.
- USTR Jameson Greer told reporters on Wednesday that meetings with Mexico's Economy Secretary had been productive, with both sides noting substantial progress in recent months. Greer said the two had also agreed to begin formal discussions on on possible structural and strategic reforms to the current USMCA agreement as part of the first joint review scheduled for later this summer. The comments signal a desire by both sides to improve and strengthen the agreement going forward.
- China's Commerce Ministry expressed a willingness to further trade talks with the US this week, emphasizing a desire to uphold and implement the the key consensus reached by the two sides in recent months. Responding to questions from reports, a Ministry spokesperson said that China remains prepared to engage constructively with the US, indicating progress was still being made despite hostilities between the two sides seemingly remaining and there being little new announced since the completion of China's soy buying program last week.
EXPORT NEWS:
- This morning's weekly export sales report, with data for the week ending January 22nd, is expected to show corn sales in the week between 1.0-2.5 MMTs, soybean sales between 400k-1.8 mil MTs, and wheat sales between 275k-600k MTs; on average, all three figures would be down from the week prior.
Be careful!
Bailey Runyen
Grain Originator | Topflight Grain Coop.
101 N. Main St. | Cisco, IL 61830
Phone :: 217-669-2141
Email :: brunyen@tfgrain.com
