March corn up ¼ at $3.8725
Jan beans down 5 at $9.235
The DOW is down
USD is stronger
Crude oil down $.02 at $60.91
In light volume, March corn closed lower for the first time in five days. Trade featured light profit taking in March with open interest falling 9,000 lots. The trend for March corn is neutral. Stable trade outside 378.5-395 is needed to provide fresh trending targets. Certainly not today but be mindful of the gap on the weekly continuation chart at 374.5. Based on the trade count, funds are thought to be short 98,000 lots.
The trend for January beans is positive but the daily chart is overbought. Stable action over 924.25 should signal a return to the recent swings highs near 960. The upper boundary of a bear channel intersects the market in the mid-940 area. Closing under 904.25 alerts for a consolidation of recent gains.
Ethanol production for the week ending December 12th totaled 1,064,000 bpd versus 1,072,000 bpd the week prior. Cumulative marketing year corn use for ethanol, implied by EIA data, is running 44 mb behind a year ago. Down 17,000 barrels on a week prior, ethanol inventories total 21.798 mln barrels. Ethanol stocks have risen over 1.5 mln barrels over the past three weeks.
Reduced imports of lean beef trimmings from Australia and New Zealand have helped push U.S. cattle prices higher. Rabo AgriFinance animal protein analyst Don Close says Australia and New Zealand have been shipping more beef to China, which has caused a significant drop in their shipments of lean beef trimmings to the U.S. “Imports of New Zealand beef trimmings into the states have been off roughly a third this year,” Close says, “and we’re expecting to see those shipments down another third in 2020, just because of the volume of trade going to China.” Close says the reduced imports of “manufacturing beef” have led to sharply higher prices, forcing fast food burger restaurants to use more domestic beef. And he expects this will only intensify in 2020, which could help push U.S. beef prices to higher than they otherwise would have been, Close says.(Source:Brownfield Ag).
Congress recently unveiled its spending packages for fiscal 2020, including a bipartisan compromise on the Agriculture-FDA bill. Negotiators agreed on $23.4 billion in discretionary funding for food and farm programs, a middle-ground between what House and Senate appropriators had proposed earlier this year — $24.3 billion and $23.1 billion, respectively. The spending deal will also extend both expired and expiring tax breaks, including the biodiesel tax credit that expired at the end of 2017. Below are more details about what’s in the package for agriculture:
Disaster Relief: The overall package includes an additional $1.5 billion in aid for farmers and ranchers affected by extreme weather this year. The relief funds will also be expanded to allow payments for quality losses due to weather damage, which will help sugar beet growers in states like Minnesota and North Dakota who are facing their worst harvests in decades. Those areas of the country suffering from the most extreme drought will be eligible for additional support. Those producers that were affected by hurricanes and wildfires will also continue to be eligible for funding.
Agricultural Research: Total funding for agricultural research is $3.4 billion, which is the same as fiscal year 2019. Total funding for ARS, USDA’s premiere in-house research agency, is $1.6 billion. Funding for the National Institute of Food and Agriculture is $1.527 billion, which is $56 million more than fiscal year 2019. Included in the NIFA funding is $425 million for the Agriculture and Food Research Initiative, $315 million for SmithLever, $37 million for the Sustainable Agriculture and Research Education Program, and $10 million for a pilot program to address the high suicide rates among farmers.
Agricultural Marketing Service: The spending bill includes $20 million for Dairy Business Innovation Centers, a $2 million increase for the National Organic Program, and $16.4 million for the implementation of the Hemp Production Program that was authorized in the 2018 farm bill.
Hemp Rules: Appropriators included a provision that would bar the use of federal funds to prohibit interstate transportation of hemp or interfere with processing, sales or use of legally grown hemp. Producers and shippers have faced legal snags trying to move the plant across state lines, thanks to a messy patchwork of state laws.
Rural Utilities: Water and Waste loans and grants are combined to fund clean water and sanitary waste disposal projects in small rural communities. Budget authority for these programs is $659 million, which is $111 million over fiscal year 2019. Additionally, the ReConnect Program, which provides funding to increase rural broadband services, is funded at $555 million.
Food and Drug Administration: Total discretionary funding for the Food and Drug Administration is $3.159 billion, an increase of $91 million over fiscal year 2019. Within this increase is $78.9 million for medical product and food safety activities and $12.1 million for critical infrastructure improvements. The bill also includes $2 million for FDA to continue work on a regulatory framework for Cannabidiol.