This Week in Grain - January 11, 2019

8:21 AM 1/11/2019

There was no USDA crop production report today (Friday) due to the government shutdown.  There have been rumors all week concerning the progress of trade talks with China. The talk coming out of Washington has been hinting that China is planning to buy large quantities of agricultural products including soybeans, corn.  Most believe that China did come in and buy soybeans this week, but again no official confirmation without the government reporting.  China is due to come to the US with a higher level delegation to continue trade negotiations.  The January USDA reports are the most anticipated of the year, due to being final corn and bean production numbers.

Soybean market is carefully watching the Chinese developments, and South American weather.  The South American weather is providing some support to the market due to dryness in some of their production areas.  The Brazilian soybean crop is being seen as smaller as of late.  China's Ag ministry says soy meal demand is expected to sharply drop due to African swine fever and lower protein levels in animal feed.

Corn production by China was estimated to be up 20%, due to an increase in acres, while demand was raised more than production, leaving a deficit.  Selling came on Thursday due to anticipated friendly updates from China an US didn't materialize.  There were optimistic corn production news out of Argentina as well as Brazilian corn crops which also contributed to the weakness Thursday.  Corn is trading in the same range that it did in October.

Wheat missed out on Egyptian business, putting pressure on that market. There is still optimism that some Algeria business will come out of the US.  


Jim Gallagher


 

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