11/6/18

Morning Commentary - 11/06/2018

US Election Day Jitters Limits CBOT Trade; USDA Report Awaits Trade on Thursday

** 6:30 AM CDT CBOT Prices:Jan soybeans are up 1.0 cent at $8.8675, Dec corn is unchanged at $3.74 and Dec Chi wheat is up 2.50 of a cent at $5.0975.

 ** AgResource AM Grain & Oilseed Comment: Good Morning its US Election Day – get out and vote! Low volume and mixed has been the overnight CBOT trade. The wheat market has shown the best strength on firming Black Sea prices while corn/soybeans take a breather from their recent rally as both markets gauge the US Mid Term election and Thursday’s USDA Crop report. It’s the value of the US dollar that will be important following the US election with traders watch to see if President Trump maintains his legislative mandate. A weaker USD would be broadly supportive to commodities.

Chinese Vice President Wang Qishan said overnight that his country is ready to have talks with the US to resolve trade issues. He went further to suggest that China is ready to enter negotiations as both sides are losers in a trade war and that cooperation is demanded from the world’s two largest economies. Wang echoed comments from President Xi on Monday that China would further open its economy to facilitate trade and fairness, yet it would not be bullied.

 Traders are in an open debate as to whether a late November G2O dinner between Trump & Xi will produce a break-through and US/China trade negotiations. Nearby, traders will be watching to see if Trump has the same “China trade optimism” following today’s US Mid Term election?

  German Environmental Minister Schulze is promising that Germany it will use all legal options to end the use of glyphosate as a weed killer and establish a stricter process for future herbicide approvals. Germany is on a growing list of countries that are trying to limit or ban glyphosates. So far, there is no impact on world grain or oilseed production, but it’s something that everyone should closely monitor.  

  Favorable weather forecasts are offered for Brazilian crops with near to above normal rainfall and near to below normal temps for the next 2 weeks.

  Argentina weather forecasts are warm/dry into the weekend before bouts of heavy rain drop on the weekend and much of next week. Key crop areas of Argentina could receive 3-6.00” of rain which will recharge summer row crop soil moisture, but the excessive rain will pose a quality/quantity risk to ripening HRW wheat crop. The world demands a high quality Argy wheat harvest amid supply shortfalls from Russia, the EU, Canada and Australia.

  It’s another 2-sided CBOT trade with wheat leading any rally effort.

** A developing Wet Weather Pattern For Argentina: 

** Warm/Dry Pattern Deepens European/Black Sea Drought: 

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