Written Commentary
MORNING COMMENTS
Macroeconomics:
The US dollar index has been trading near 106 since mid-November, following it’s rally from late September (following the -50 basis point interest rate cut by the Federal reserve). The current probability on the fedwatch website shows the market is expecting a 25 basis point cut announced on December 18th. 86.% probable for a 25 basis point cut.
Ag Fundamentals:
All eyes on the USDA’s WASDE report out at 11:00am CST today. Many are of the opinion the USDA will not be overly aggressive when estimating the South American crop despite the favorable weather. Soybean bulls are still timid with the potential of a +170 million MT Brazilian soybean production, but the incoming Trump administration could change everything by leveraging US business to ensure Chinese participation. Corn had the strongest recovery from it’s late August lows. Ethanol demand and corn exports should increase usage and give farmers a reason to plant more corn next year. US corn ending stock could move closer to 1.8 billion if the USDA decides to increase the demand side of the balance sheet. Russian wheat exports are expected to drop from 55 million MT to 48 MMT and Ukraine’s numbers are expected to follow suit, down 2.5 million MT from 18.5 MMT. On the other hand, Canada, Australia, Argentina and the US will offset by increasing wheat exports. Many within the export space are cautiously navigating the market until January 20th.
FedWatch Predicts a -25 basis point cut on December 18th. Bringing the federal interest rate to 4.25-4.50%
EXPORT INSPECTIONS WEEK ENDING 12/5/24
Corn |
| Soybeans |
| Wheat |
|
Country | Metric Tons | Country | Metric Tons | Country | Metric Tons |
Total | 1050 | Total | 1622 | Total | 226 |
Mexico | 345 | China | 847 | Indonesia | 68 |
Japan | 269 | Italy | 142 | Mexico | 44 |
South Korea | 131 | Turkey | 125 | Yemen | 33 |
Spain | 66 | Mexico | 96 | DR | 28 |
El Salvador | 56 | Indonesia | 80 | Columbia | 21 |
EXPORT & WORLD NEWS
Spain has booked purchases of corn from the US that sum up to 500K MT for Q1 2025 delivery. Algeria has not yet booked their 240K Mt of corn from South American origins.
Malaysian palm oil futures were down overnight 165 ringgit, now at 4955.
Daily Trading Limits: Corn $0.30 (expanded $0.45); Soybeans $0.85 (expanded $1.30); Minneapolis Wheat $0.60 (expanded $0.90); KC Wheat $0.40 (expanded $0.60); Chicago Wheat $0.40 (expanded $0.60)
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