Written Commentary
MORNING COMMENTS
Geopolitics:
Hezbollah shot 90 rockets into the port city of Haifa in Israel on Monday. Since the news of a Trump presidency, many reports have been optimistic he may help keep the peace, but Hezbollah broke that trend yesterday. Additionally Lebanon shot around 50 rockets into the upper and western regions of Galilee. Over 80K Israeli residents have evacuated from their homes and neighborhoods within the last year.
Macroeconomics:
Crude oil is trading lower this morning. OPEC has lowered it’s global demand projections for 2024 and headlines out of the middle east and Russian/Ukraine conflict have slowed.
Ag Fundamentals:
Corn has some life. If March corn closes above 450’0 the next resistance is the 200 day moving average at 455’6. There has been more open interest added to corn calls at 450 and 455 since Friday’s report last week. Many continue to point about corn demand and the likelihood that the USDA lowers ending stocks by increasing exports and usage. Soybeans will most likely trade flat to lower unless it stops raining in South America between now and mid December. Farmers are continuing to sell both corn and beans into small rallies. Estimates suggests the US farmer has sold 35% of their 24/25 corn and 44% of their 24/25 beans. Almost nothing on the books for next crop year, 25/26. Crop progress reports are expected to release later today.
Weather:
River levels have improved and are expected to stay at appropriate levels to sustain proper barge drafts. The extended experimental forecast has the Lower Mississippi in good shape for the next 28 days. The Panama Canal has also recovered from it’s low water struggles. They are now projection to be above the 5 year averages for December and January after spending the last year recovering from drought beginning in late 2022.
The Mississippi River Gauge at Memphis is currently at 4.45 ft. The stage barges start to loose draft is -2.5 ft. According to the 28 day experimental forecast below, water levels should stay above that for the next 4 weeks.
Panama Canal Water Levels are in much better shape than a year ago. Drought began in late 2022 in Panama and has spent the last year slowly recovering. The first chart is the water level history and the lower chart is the water level projection for December and January. Expecting levels higher than the 5 year average.
The Next 10 days of Precip in South America
Export & World News
Private exporters report 110K MT of corn sold to Mexico this morning. Bangladesh issued an international tender to purchase 50K MT of milling wheat. Algeria is looking to purchase up to 240K MT of animal feed corn from Argentina or Brazil.
Malaysian palm oil futures were down 170 ringgit overnight, at 5026.
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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