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AgriVisor Morning MarketWatch

 
Wednesday, May 08, 2019
Highlights
• Chinese trade delegation in Washington tomorrow and Friday for talks. Would not come as a shock to see “good faith” sales made. 
• Starting to see more positioning ahead of Friday’s WASDE report. This to give us our first “official” look at new crop balance sheets
• Rains for the Corn Belt to finish out the week, much improved conditions expected in 6-10 day models
Corn
• Initial new crop carryout expected at 2.1 billion bu, old crop at 2.055 billion bu
• Global corn stocks to tighten 25-30 million metric tons this year
• Wet forecasts likely to reduce acres
• Planting delays likely to lead to delayed harvest, possibly dry-down issues in corn
Soybeans
• Initial new crop carryout estimate of 910 million bu; old crop at 920 million bu
• Does China need soybeans from anyone? Brazil April exports down 19% from the same month a year ago. 
• Would not come as a surprise to see more soybean acres in June revisions
Wheat
• 2019/20 average carryout estimate is 1.06 billion bu, old crop 1.1 billion bu
• Record Ukraine wheat crop being reported. Global crop is getting larger, demand growth not keeping up. 
• On paper, wheat works as feed ration ingredient. In reality, it is unlikely we see much feeding. Corn remains abundant and feeders are already forward contracted in most cases. 
Livestock
• China has been avoiding US pork. Good faith sales a possibility today? Packer margins have turned negative for pork showing just how low current demand is. 
• Cattle worked higher yesterday as light buying surfaced in the complex. At the start of the US grilling season this may be a good indication of a bottom. Cash values showing some unstability with a wavering economic market. 
 

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