Written Commentary
MORNING COMMENTS
Macroeconomics:
China coming out with a generous stimulus package is not necessarily bullish. The government needing to step in and help is a sign of weakness and if the package doesn’t help the millions of residents in China right away, there my be continued headwind for the Chinese economy. The east coast port strike here in the US is the most concerning upcoming event, expected to begin on Tuesday next week. Some ports are already preparing for the shut down and walk out.
Ag Fundamentals:
Russia has cut its wheat crop forecast from 82.2 million MT to 81.8 million MT. The main reason for the lower production was damage to crops in eastern regions of Russia due to waterlogged soil. there were five regions in Russia that declared a state of emergency caused by heavy rainfall earlier this year. Russia expects to export 44 million tons of wheat for the 24/25 marketing year.
Weather:
Hurricane Helene made landfall last night as a category 4 hurricane. It was still a category 1 as it entered the state of Georgia. Rains are expected to continue north through Atlanta into Tennessee and Kentucky and parts of Indiana, and Illinois. River levels at Memphis are expected to remain above low water stage from Sunday until at least October 8th. Looking at South America, one of the main reasons we haven’t seen an early monsoon in Brazil is the low level flow is coming directly out of the east. In order for the Monsoons to begin, the flow needs to swing more north through the humid air northeast of Brazil.
Russia’s Crop Calendar below shows they are currently finishing up their spring wheat harvest and they are in the middle of planting season for winter wheat.
Export & World News
Algeria has issued an international tender to purchase around 240K MT of animal feed sourced from Argentina or Brazil. Jordan has issued an international tender to buy up to 120K MT of milling wheat from optional origins.
Malaysian palm oil futures were down 100 ringgit overnight, at 4052.
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