News

Morning Commentary

Dec corn down ¾ at $3.565

Nov beans down 6 ¼ at $8.41

The DOW is down

USD is weaker

Crude oil up $1.04 at $71.82

Good morning,

Corn prices have rallied +15 cents from the lows posted last Tuesday. The weather, particularly heavy rains, are creating some harvest complications and some late season disease in areas of the U.S. There’s still heavy debate inside the trade about the USDA’s next step. Will they raise or lower their current yield estimate? Historical wisdom tells us big crops tend to get bigger, but with the USDA taking their yield estimate higher the past two months, from 174.0 in July to now 181.3 in September, there’s many arguing they’re overly optimistic and ultimately will need to trim their forecast.

Soybean prices are lower this morning as traders continue to debate U.S. and Chinese trade relations. The worlds top two economies just imposed their largest rounds of tariffs which officially go into effect today. Many inside the trade believe relations are going to get worse before they get better. President Trump has threatened tariffs on another $267 billion of Chinese products, while over the weekend the Chinese put the brakes on plans for a new round of negotiations. Several inside sources are now worried we could be taking steps towards a longer-term deadlock. Bears are also pointing to complications and negative headlines surrounding African Swine Fever. Keep in mind, China recently reported the first couple of cases showing up in the province of Jilin. China has reported close to 20 outbreaks of the disease in eight provinces in less than two months. They are desperately trying to control the disease, but new cases are hoping up every week. We are also seeing headlines about African Swine Fever showing up in new parts of Europe. This is obviously bringing into question overall global meal demand. Bottom-line, there’s still a ton of negative headlines floating around in the soybean market. We rallied +30 cents from the lows posted last Tuesday,

Bayer is expected the EPA to announced a renewal and an updated label for the herbicide dicamba in the coming weeks. The weed killer was authorized initially for two years by EPA. That authorization runs out in November. The agency must decide whether to extend its use and whether to make changes to how and when it can be used. Of course, there has been great controversy over high drift and volatility complaints against Dicamba over the past two years.

Milk & Eggs, a Los Angeles-based online perishable food market and delivery service connecting farmers and artisanal food makers with consumers, has completed a $6 million seed round. While general competitors are stores like Walmart, Kroger, Whole Foods, and online delivery services like Instacart and Amazon Fresh, Milk & Eggs is different because what’s purchased is made-to-order. The simplest way to put it is, Milk & Eggs is an online farmer’s market that delivers; it’s like it’s providing people with their own personal farmer, says cofounder and CEO Kent Wu.

 

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