Written Commentary
MORNING COMMENTS
Macroeconomics:
Saudi Arabia and other allied members of OPEC were expected to start increasing their output of oil at the end of November. They Announce yesterday that they plan to wait a month and start increasing output at the end of December. Crude oil is up $2 per barrel on the news this morning. Both Israel’s anticipated retaliation against Iran and the US election may be influencing this move. After Friday’s poor job report and expected future revisions possibly making reality appear worse, gives fuel to the Fed’s decision to cut rates this week. Today the market is expecting a 25 basis point cut, anything different would increase volatility.
Ag Fundamentals:
The WASDE report is expected to release on Friday @ 11:00am CST. Corn usage should increase, but major cuts need to be made to the global supply of row crops to improve prices assuming demand won’t be enough to support. Strength in crude oil and the US dollar down slightly this morning may be the reason beans are higher to start the week. Today you can expect managed money to also pull their potions closer to the chest. Rains may slow the last 5-10% of harvest, but there should be enough windows to hit between now and mid November to complete this years harvest.
Weather:
Rains are making there way up the Midwest from central Missouri through the north half of Illinois and into northern Indiana. Parts of Kansas, northwest Iowa and southern Minnesota are also seeing scattered showers. Minimum temps today and tomorrow are very warm for this time of year but are expected to cool back down on Wednesday/Thursday. We can expect more rain events over the next 10 days that will help river levels improve slightly before temps drop too low.
The Mississippi River Gauge at Memphis is showing improvement thanks to recent rains and upcoming showers across the center of the country. Memphis harbor can load barges to full draft above -2.5 ft.
Rains in the Ohio River Valley and Mid-Mississippi River Region will help improve water levels. Areas in the green boxes below will contribute the most to water levels in the next 5 days. Some areas in the mid south and south are expecting to see up to 8-9 inches in the next 10 days.
Export & World News
150K MT of corn was sold to Mexico in a flash sale this morning. Additionally 120K MT of corn was sold to unknown destinations from the US. The US also sold 130K MT of soybeans to unknown destinations today.
Malaysian palm oil futures were up 23 ringgit overnight, at 4891.
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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