Market Commentary: Today was Green but Headwinds for the Week
Corn, soymeal, live cattle and lean hogs all traded lower during the morning start but by the end of the day, only lean hogs ended lower. There were modest volumes being traded on Friday for most contracts, except feeder cattle where it was nearly double the five-day average.December soymeal hi...
Cow-Calf Margins Steady in November, Herd Expansion Still Likely
Despite recent decreases in feeder cattle futures and rising feedstuff costs, estimated cow-calf producer margins are largely unchanged from WPI’s October estimate. The stable and positive financial environment means that producers are still facing strong financial incentives to expand the U.S...
McSustainability Through Feed Efficiency
McDonalds has entered the sustainability space by partnering with Syngenta and paying cattle producers to use Syngenta’s Enogen Trait corn to improve feed efficiency. Enogen corn contains an enzyme, alpha amylase. This enzyme has been added during the ethanol production process to induce starch...
Livestock Roundup: Turkey Production Adjusted Down
Turkey production in August totaled 434.7 million pounds, slightly above July production but down 11 percent year-over-year. August slaughter was down 15 percent year-over-year, but heavier weights in August (32.25 pounds) offset the reduced slaughter. Based on the August production data, estim...
FOB Prices and Freight Rates App (Updated 15 November)
Ocean Freight Comments - 15 November 2024By Matt HerringtonDry bulk freight markets were mixed this week with Capes rising while Supramax vessel rates declined yet again. The Capesize sector found support from China’s recent efforts to stockpile coal and iron ore, but this support has not yet t...
Market Commentary: Biofuel and Trade Policy Worries Pressure CBOT along with Dollar Strength
The CBOT saw another day of pronounced weakness with expectations for larger global soybean and wheat production and stocks in 2025 weighing on values. Product demand in the soy complex has also been a huge negative factor recently with uncertainty over U.S. biofuels policy causing a sharp redu...
Oilseed Highlights: Multi-Bearish Factors
The MarketThe January soybean contract has been sliding all week and despite support at the 20-day moving average of $10.01/ST, it closed today below $10/bushel for the first time this month. The reasons are many including: a rising dollar value, 2) large impending South American production, 3)...
Market Commentary: Bearish Beat Goes On
The CBOT was essentially all red on Wednesday with traders finding little support from either the fundamental or technical components of commodity price analysis. Wheat was the downside leader for the day as a strong dollar, improving conditions in the Plains, and increasingly tepid exports fro...
EU Studies Trading Houses
As part of its witch hunt for unfair market practices, the EU Parliament’s AGRI Committee requested a study of the major agricultural commodity trading companies and their impacts. The study may inform populists in the U.S. that also see consolidated industries as inherently harmful, but...
USA Gone Nuts
While oilseeds receive much of the attention, tree nuts, which are technically a seed and containing oil, have gone even more gangbusters for U.S. producers in recent years. Almonds have received much of the focus as the U.S. produces nearly 80 percent of the crop and a comparable share of the...
Black Sea Regional Analysis
Russian Grain Markets: 4 – 8 November 2024We have heard the voices from various sources forecasting a new grain crop in Russia and most of them differ in numbers. We will have to deal with terminology like bunker weight (straight from the combine) and standard weight (cleaned and dried accepted...
WPI Crop Progress and Conditions App (Updated 12 November)
Update for 1 April 2024: Last year, users pointed out differences between the 5-year averages reported in this app and what USDA estimates in its weekly report. The difference exists because WPI calculates average based on the last 5 years of observations for the current week. In cases where ob...
Market Commentary: Funds Resume Soy Complex Selling; Wheat Falls on Improved Weather
The CBOT was almost uniformly in the red on Tuesday with any bullish supply-side implications from the November WASDE largely forgotten (or ignored) amid bearish demand-side developments. The recent rally in the U.S. dollar is threatening to undo much of the export demand gains the market has w...
Cuban Pipedream
Some in the U.S. agriculture community have spent years trying to improve sales to Cuba, which have increased though from a very small base. Now there is even less reason to think they’ll succeed. Their pipedream has been a hungry population of around 11 million people just 60 miles off the Ame...
Trump’s Tariff Plan; Whither Europe; RTO Beats WFH
Trump’s Tariff PlanFew things attract more speculation than how President-Elect Donald Trump will model his plan to increase tariffs on imports. Some economists have taken his most exaggerated claims and predict they will cause slower economic growth and higher inflation. At least one advisor s...
Political Landscape Taking Shape
After the 2024 elections, the Republicans look to have taken control of Congress, along with a Trump victory, providing a Republican triple sweep. The Senate GOP majority is 53 to 47; and the House GOP majority is still TBD. However, as of today, the Republicans have secured 215 seats, and Demo...
Middle East, Mediterranean and Africa Regional Analysis
Regional UpdatesMEDITERRANEAN/MIDDLE EAST/NORTH AFRICA/AFRICA – MEA REGIONPakistan has decided to allow the importation of GMO soybeans from the U.S. – critics say that this decision was made without proper risk assessment and was only done due to pressure from large industrial companies. Forty...
Livestock Industry Margins
WPI is excited to present the latest edition of our newest data-driven publication Ag Perspectives Quant: U.S. Livestock Industry Profit Margins. This report offers a comprehensive look at the profitability of the U.S. beef and pork sectors, from cow-calf and farrow-to-finish producers up the v...
Market Commentary: CBOT Slips as Demand Worries Overtake Supply-Side Surprises
The November WASDE offered mixed influences for the major ag markets with USDA making surprise cuts to the U.S. corn and soybean crops and ending stocks, which rallied markets on Friday. The report also, however, cast doubts on the demand-side outlook for both crops and wheat, and that is what...
Deep Bench to Fight RFK; China Market Risk; Thankless Job
Deep Bench to Fight RFKBeing the U.S. Secretary of Agriculture is usually a pretty good job. It involves doling out billions of dollars, the constituency is dominated by courteous country people, and controversies tend to be minor. The person serving the longest in any Cabinet position was Jame...
Rice as a Stable Crop
Last year, India restricted non-Basmati rice exports believing there would be a weather-related short supply. Production was ample and now the country faces record high inventories that will likely be dumped on the world market. The OECD calculates that Indian farmers are implicitly taxed $120...
Senate Committee Changes and Ethanol Legislation
As WPI noted a week ago on 4 November, As a general rule, a Republican agenda is likely to be friendlier to liquid fuels, especially petroleum fuels, whereas a Democrat agenda is more likely to include a role for electric vehicles, and a renewable fuels policy that will focus on reducing c...
Mercosur Regional Analysis
Wheat As of the end of the first week of November, 12 percent of Argentina’s sown wheat area has already been harvested. Harvesting is progressing quickly in the country’s north, with yields that are low but within expectations. Although a few more weeks will pass before the harvest is wid...
CFTC COT Report Analysis
The major finding of Friday’s CFTC report was the confirmation that funds have officially flipped their formerly massive net short in corn to a net long. After buying back nearly 40,000 contracts last week, funds now sit long 3,035 contracts as of 5 November, a position which was extended signi...
Market Commentary: Somewhat Tumultuous WASDE
The November WASDE report usually involves some tweaking of the numbers by USDA, and that is all it mostly was today, but with some quirky impacts. First, there were a few surprises but not dramatic ones and yet the report spurred larger to outsized volume in trading across the grain and oilsee...
Who Might Be the Next Ag Secretary?
As most Presidents-elect do, former President and President-elect Donald Trump has named his new White House Chief of Staff as his first appointment. It is Susi S. Wiles. Wiles was the co-manager of Trump’s 2024 campaign, and also was a key strategist focused on Florida in his 2016 and 2020 cam...
WPI 2025 Hog and Pork Outlook
U.S. hog producers saw a mixed year in 2024 with early-year prices bringing poor profitability while the dramatic hog rally since the summer has lifted financial fortunes significantly. A major component of those rising prices was the unexpected surge in pork demand, which pushed the cutout to...
Market Commentary: Soybeans, Soyoil Rally on Export Numbers; Cattle Gain on Macro Strength
The CBOT was mixed on Thursday following the news of Donald Trump’s election to President of the United States with markets, particularly corn and cattle futures, seeing continued support from “risk on” trade. It’s not necessarily that traders and investors are particularly excited about Trump’...
Transatlantic Trade War; Traders Beat Pollsters; Transatlantic Lesson
Transatlantic Trade WarU.S. equity markets rose yesterday on news of Donald Trump’s victory, while shares in Europe fell. The EU is America’s biggest trading partner and Trump promises tariffs. EU officials are strategizing on how to deal with a Trump presidency, with some urging cooperation, a...
Livestock Roundup: Beef Overview
Little to no action has been reported in the cash markets and asking prices are back at $190/cwt and higher. Cattle supply numbers are tighter in the south than in the north, and carcass weights took a pause from the steep rise that has taken them to all-time highs this year. The latest report...
Oilseed Highlights: On an Upswing
The MarketThe January soybean contract is up 3.2 percent on the week and has is now up 3.5 percent from its late October low at 979/bushel, but it is still 5 percent below its late August high at 1083/bushel.11072024oilseeds_beans.png 1.16 MBUntil today’s turnaround following very large export...
Market Commentary: Mild Election Impacts
Outside markets closed higher and the dollar was up, but not because of bullishness over Mr. Trump’s victory. The business sector likes his pledge for lower taxes and less regulation but is less enthralled with his attraction to tariffs. In fact, the tariffs are expected to be inflationary, cau...
The Day After
The political establishment in Washington is stunned following yesterday's rout by Donald Trump and the Republicans. The Democrats’ arch nemesis not only survived everything they threw at him, but he also took an increasing share of the minority voting block that they claimed as their own. It w...
WPI Preliminary 2025 Acreage Forecasts
The polling for the 2024 U.S. Presidential election had significant forecast errors and history will likely judge the numbers as “wrong”. While it’s hard to argue against such judgement when the results proved a historic sweep for Trump versus predictions of a tight race, the pre-election polls...
Black Sea Regional Analysis
Russian Grain Markets: 28 October – 1 November 2024Russian analysts revised the 2024 Russian crop downwards to 128.8 MMT without newly occupied territories but with Crimea which was occupied a decade ago. This new forecast is down 11 percent from the previous year. Wheat is at 85.6 MMT – down 8...
Market Commentary: Election Day Brings CBOT Gains
It’s election day in the U.S. and the nation will decide on new leadership for the White House and Congress, though results may not be available for days or possibly even weeks. National polls indicate a tight race between candidates Trump and Harris, but betting markets tell a different story...
Tax Policy Outlook Post Election
After the votes are fully counted, as a new Administration forms, and Congress organizes, WPI will take a deeper look into the policy implications of today’s election. From today’s point of view, unless this election is an unexpected blowout (countering polling data that shows it neck and neck...
EU Confirmation Hearings; Japanese Independence; Lemonades out of Lemons; Border War
EU Confirmation HearingsIn a few months, it will be the turn of either Donald Trump or Kamala Harris’s cabinet nominees to seek confirmation by the legislature but this week it is Europe’s Commission designates confronting the hurdle of the European Parliament (EP). Maroš Šefčovič, Commissioner...
Middle East, Mediterranean and Africa Regional Analysis
Regional UpdatesMEDITERRANEAN/MIDDLE EAST/NORTH AFRICA/AFRICA – MEA REGIONTunisia will shortly receive a shipment of 33,000 MT of U.S. corn, the first shipment in quite a while. The U.S. Grains Council office in Tunis says that they expect more U.S. corn imports in the coming weeks.Morocco has...
Livestock Industry Margins
WPI is excited to present the second edition of our newest data-driven publication Ag Perspectives Quant: U.S. Livestock Industry Profit Margins. This report offers a comprehensive look at the profitability of the U.S. beef and pork sectors, from cow-calf and farrow-to-finish producers up the v...
Market Commentary: Grains Rise on Export Demand; Soyoil, Livestock Fall on Technical Trade
The CBOT was mostly higher to start the week with fresh daily export sales announcements and a solid Export Inspections report underpinning the day’s moves. While corn, soybeans, and KC wheat all settled higher for the day, gains were muted as few traders were interested in adding significant r...
Renewable Fuel Policy Outlook in 2025
Tomorrow is election day; the make-up of Congress and who is in the White House is expected to have an impact on renewable fuel policy in 2025. As a general rule, a Republican agenda is likely to be friendlier to liquid fuels, especially petroleum fuels, whereas a Democrat agenda is more likely...
Transatlantic Inverse; Farm Bill Chances
Transatlantic InverseDepending on tomorrow’s election outcome, American businesses will either be saddled with more taxes, regulations, and attacks on consolidation, or be hit with higher import tariffs and maybe the goofy ideas of people like Robert F. Kennedy, Jr. By contrast, Europe has now...
Mercosur Regional Analysis
Wheat The long-awaited rains have finally arrived in southeastern Buenos Aires, with precipitation totals ranging from 20–50 mm. While the rainfall isn’t sufficient to complete the wheat crop, it provides relief to an area where plants were beginning to suffer. For now, it halts the declin...
European Market Analysis
Regional News Algeria bought 600 KMT of wheat in its tender that closed on Monday, buying the full volume permitted, and prices are rumored to be near $263/MT C&F. Traders suspect much of the wheat is Black Sea-origin, given the diplomatic tensions between Paris and Algiers right now...
CFTC COT Report Analysis
Through 29 October, funds continued their aggressive short covering in the corn market with strong export sales justifying the move. Funds reduced their net short position by about 60 percent last week, and now hold a relatively small position of 35,000 contracts short. The continued exit from...
State Directed Meat; Living Space
State Directed MeatUSDA has been issuing loans and grants to startup livestock businesses with the goal of diversifying the industry, providing producers with more options, and lowering the price of meat. Now Pure Prairie Poultry of Minnesota, a beneficiary of $38.7 million in loan guarantees a...
Market Commentary: A Week of Notable Numbers
Except for soymeal, the rest of the grains and oilseeds contracts traded higher in the overnight, and opened higher this morning, but only corn and soyoil ended the day higher. New contract highs were scored today in lean hogs and Malaysian palm oil. A new contract low was marked today fo...
October Jobs Report Tepid
The Bureau of Labor Statistics (BLS) released the October jobs report this morning. Total nonfarm payroll employment was essentially unchanged in October (+12,000), and the unemployment rate was unchanged at 4.1 percent. The pre-report consensus was for an additional 100,000 payroll...
U.S. Soybean Crush Margin Outlook
The three legs of the U.S. soybean crush have each seen interesting and divergent dynamics over the past month that have influenced the crush margin outlook. Notably, soymeal prices have slumped $30/MT lower since early October and are hovering near contract lows just below the $300 mark. Conve...
Market Commentary: CBOT Debates Following Seasonal Rules
The CBOT was mixed for the day with wheat futures sinking lower after the HRW and SRW growing regions received favorable rains Wednesday and early Thursday. That, combined with export pressure from Russia and the Black Sea countries, put wheat on the defensive with funds emerging as net sellers...
Oilseed Highlights: Bounce off the Bottom?
The MarketJanuary soybeans have now rebounded a second day in a row after opening the week lower. While it came within 10-cents of the contract low, exports are booming and most of the bearish inputs (better weather and large South American crops, a weaker real, harvest pressure, and rising glo...
Livestock Roundup: Broiler Outlook
Broiler slaughter was 158.86 million head last week, up from 158.139 million the week before and continuing to run above a year ago. Broiler production in the last quarter of 2024 is forecast to be up 4 percent, bringing the total annual production up 2.2 percent from 2023. Any miss in th...
Market Commentary: End-of-Month Trade, Profit Taking Create Mixed Markets
The CBOT was mixed in moderate-volume trade on Wednesday with markets across the board seeing impacts from end-of-month position adjusting and profit taking. Wheat futures were higher on poor U.S. conditions ratings and drought conditions in the Southern Plains, despite forecasts of rains this...
Misdirected Fire; Over-Capacity
Misdirected FireThe Kamala Harris campaign is frustrated that the economy is hot, inflation has dissipated to just 2.4 percent, and yet voters are not feeling it. Politicians learned long ago to never tell the voters they are wrong and have misperceptions. Consequently, she has been acknowledgi...
Black Sea Regional Analysis
Russian Grain Markets: 21 – 25 October 2024The Russian grain markets remained stable on the export front and slightly bearish after recent peaks. Domestic prices are trying to catch up with export price levels and even in Siberia, prices were recovering. Global pricing effects export prices in...
Market Commentary: Poor Conditions Rally Wheat; Big Crop(s) Pressure Soybeans; Hogs Hit New Highs
The CBOT was mostly higher on Tuesday with the wheat market in the lead on worrying crop conditions and persistent drought in the HRW growing region. USDA’s initial crop ratings for the winter wheat crop were the second lowest for the week since the mid-1980s, which means the rains in the two-w...
Livestock Industry Margins
WPI is excited to present a new, weekly, data-driven publication Ag Perspectives Quant: U.S. Livestock Industry Profit Margins. This report offers a comprehensive look at the profitability of the U.S. beef and pork sectors, from cow-calf and farrow-to-finish producers up the value chain through...
Interest Rate Outlook
The Fed meets next week, the day after the election. It looks likely there will be a rate cut again for the second time in as many meetings. The federal funds futures market is pricing in a 95.4 percent probability of a cut. At the September meeting, Fed members signaled another 50 basis point...
Post-Election Transatlantic
The EU’s dependency on the U.S. for both defense and economic well-being has focused discussions in Brussels on what the relationship will look like should Donald Trump win on 5 November. The Biden Administration initiated a Trade and Technology Council (TTC) in 2021 with designs to coordinate...
Middle East, Mediterranean and Africa Regional Analysis
Regional UpdatesMEDITERRANEAN, MIDDLE EAST, NORTH AFRICA, and AFRICA – MEA REGIONTurkey’s wheat production is seen dropping by 5.5 percent to 20.8 MMT according to Turksat estimates. It also sees barley production down by 11 percent to 8.2 MMT and corn down by 8 percent to 8.3 MMT. Soybean prod...
Market Commentary: Oil Drags CBOT Lower; Hogs Hit New Highs; Cattle Rise After Report
The CBOT was mostly lower for the day with the sharp decline in crude oil futures dragging soyoil, the broader soy complex, and corn and wheat lower. There was little fresh fundamental news to guide commodity futures for the day, which gave the oil market’s plunge an outsized influence on ag fu...
Newsom for President; Fake Meat Lacks Standing
Newsome for PresidentUntil this past Friday, U.S. ethanol producers feared that the California Air Resources Board (CARB) might make an effort to limit the marketing of their products in the Golden State. Now they are singing in the streets as California Governor Gavin Newsom instructed CARB to...
Food Price Outlook Improves
There are often lags in time between when consumers notice a change in the economy, they begin to voice concerns, politicians begin to echo those concerns, and ultimately policymakers take some form of action, if any. Food price inflation is a perfect example of that dynamic. Democratic preside...
RFK Jr Role in a Potential Trump Admin Worrying Aggies
With the election one week from tomorrow, many aggies are turning their attention to the probable role of Robert F. Kennedy Jr. in a Trump Administration should Trump win the election. Over the last week, this is literally the biggest topic of conversation among this analyst’s contacts and sour...
European Market Analysis
Regional News Russia’s winter crops may see 1.5 million hectares (Mha) go unseeded this year due to poor weather in key growing regions. Originally, 20 Mha was expected to be sown to all winter crops. Grain production in 2025 is unlikely to exceed 120 MMT now, due to the acreage reduction...
Mercosur Regional Analysis
Weather Argentina saw continued rainfall throughout last week and so far during October, nearly all of the country’s agricultural regions experienced at least some precipitation. In areas like the Nucleus Region, totals have even exceeded historical averages for October. This rainfall has...
CFTC COT Report Analysis
Through 22 October, funds engaged in the expected short covering in the corn market amid the unexpected surge in exports. Funds’ total buying volume, however, was below expectations at just shy of 20,000 contracts though they certainly added to that number after Tuesday’s data reporting deadlin...
Market Commentary: Mix Week Reflecting Fundamentals
Yesterday’s bullish Export Sales report was followed by more sales of corn and soybeans today. However, there had already been sufficient gains in the futures market this week and current sales are simply on track with USDA’s forecast. The trade does not want to get too far out in front of the...
Cattle on Feed Report
USDA released the monthly Cattle on Feed report today, which was mostly in line with pre-report expectations; only placements came outside of the consensus forecast. 10252024dj.jpg 50.4 KBSeptember marks the beginning of the fall run for cattle placements. Placements last month at 2.156 million...
Forecasting 2025 Cattle Inventories: Small Herd Increases Expected
As WPI has written about several times recently, the beef industry is eagerly awaiting the January Cattle Inventory report from USDA to see whether producers are starting to expand the herd. This information will be valuable for gauging cattle supplies in 2025 and 2026 and will help set pricing...
Market Commentary: Corn, Wheat Rise on Export Data; Soybeans Fall on South American Weather
Exports remain the name of the commodity game this week with all eyes on the UDSA daily “flash” export sales announcements as well as this week’s weekly Export Sales report. On Thursday, both of those factors did not disappoint and gave the already bullish corn market another boost. USDA report...
Oilseed Highlights: Steady Under a Delicate Balance
The MarketU.S. soybean exports have been impressive, but funds continue to focus on South American rains. For the week to date, November soybean futures are higher but cannot maintain a close back up over $10/bushel. They are challenging resistance but remain below the 50-day MA at 1007.25/bush...
BRICS Grain Exchange; Transatlantic Gaslighting
BRICS Grain ExchangeVladmir Putin used his BRICS conference in Kazan, Russia to formally suggest the creation of a grain exchange by the bloc of countries. He said such an exchange could later be expanded to other products and that it would " contribute to the formation of fair and predictable...
Livestock Roundup: Cattle on Feed Preview
USDA will release its Cattle on Feed report tomorrow; the pre-report consensus of analysts’ estimates is for the inventory of cattle on feed as of 1 October to be 99.7 percent of last year; September placements and marketings are expected to be 95.8 and 102 percent respectively of last year’s t...
Market Commentary: More Exports, More Gains
A sixth straight day of daily “flash” export sales announcements from USDA sent CBOT corn and soybean futures higher with funds covering shorts and commercials positioning bullishly too. The export demand for corn caught the market by surprise and has created the current rally, while the season...
Inflation Disconnect; Economic Opinions
Inflation DisconnectEconomists including those at the Federal Reserve use so-called core inflation when assessing the level of rising prices in the economy. Core inflation excludes food and energy prices since they are considered more volatile, and less directly impacted by the Fed’s monetary p...
TFP as Focus
The International Monetary Fund increased its forecast for U.S. GDP growth this year to 2.8 percent, versus 0.8 percent for the Euro Area and the 0.9 percent average for the non-U.S. G-7 countries. Competitiveness is said to be the primary term in Brussels these days, as it should be. The avera...
Mercosur Regional Analysis: Soybeans
Last week, soybean trading saw a lot of activity, particularly with Brazilian old crop shipments and increased movement in U.S. new crop sales. CNF China trade levels began at 240X for the PNW and 255X for the U.S. Gulf, rising rapidly due to several factors. A drop in Chicago futures triggered...
Black Sea Regional Analysis
Russian Grain Markets: 14 – 18 October 2024Russian grain markets remained slightly bullish but not as bullish as a week ago. The biggest concern of all grain exporters is a “threat” from the Russian Grain Export Union that October export prices should be $240/MT and that to make this happen the...
Market Commentary: Exports, Weather Concerns Push CBOT Higher
The CBOT was mostly higher on Tuesday as export demand continues to fuel what looks like the start of a demand-led swing higher in the markets. Tuesday marked the fifth straight business day with a “flash” export sales announcement for corn, with Mexico responsible for essentially all of the de...
U.S. Dietary Guidelines: Booze and Junk Food
Every five years, the Dietary Guidelines for Americans, issued by USDA and the Department of Health and Human Services (HHS) are updated. The new guidelines will be issued next year for 2025-2030. This guidance provides advice on what to eat and drink to meet nutrient needs, promote health, and...
Policy Shortz
U.S. – EU Reset: The transatlantic relationship must be reset after the upcoming election. Brussels produced a state-by-state report on Europe’s trade and investment engagement to help set the environment. U.S. technology firms argue it is ludicrous for Europe to think it can be competitive in...
Bangladesh Food Import Projection
Bangladesh is the third largest food importer in the world. It imports over $15 billion worth of food annually or about 11 percent of its total food consumption. Imports include 5 MMT of grain (3.57 MMT is wheat), plus palm oil, milk powder, and other products. Roughly 3.5 percent of its food i...
The Middle East, Mediterranean and Africa Regional Analysis
Regional Updates MEDITERRANEAN, MIDDLE EAST, NORTH AFRICA, AFRICA – MEA REGIONAfrica spends $75 billion every year importing cereals according to the African Development Bank – 50 MMT being wheat – 27 MMT imported by North Africa, 12 MMT by East Africa and 9 MMT by West Africa. Wheat...
Market Commentary: Exports Rally Corn, Soybeans but Pressure Wheat; Hogs Hit New Contract Highs
The CBOT saw mixed trade again to start the week with a slate of fresh daily “flash” export sales announcements supporting corn and soybeans, as did a generally positive Export Inspections report. That helped soybeans recover from Friday’s drubbing and allowed the corn market to follow through...
Biggest Monopoly; Aggies Challenge Trump; Food Safety Risks and Perceptions
Biggest MonopolyReflecting voter concerns about food inflation, both Harris and Trump are attacking the food system and implying concerns about monopoly power. But no industry is as monopolistic as politics where consumer choice is often limited to just two parties. Voters are near evenly split...
Aging, Shrinking Dairy Herd Tied to Beef Dynamics
There has been much discussion this year to the size of the beef cattle herd. The year started with the lowest overall cattle herd since 1951. Demand for beef, high prices for beef and cattle, and marginal increases in imported feeder cattle have all helped maintain production, as has heavier s...
The Mercosur Regional Analysis
WeatherThe week continued with rain in some areas of the agricultural region that spread water across almost the entire region, ending a 10-day period of instability. The exceptions were the western part of Buenos Aires Province, which received only a few millimeters despite needing more, and t...
Olive Oil Volatility
Bloomberg notes the problems confronting small scale olive oil producers in Spain and Italy. Production is volatile and has been under duress from drought and climate change. As a result, the price has risen, attracting investors who are creating larger scale farms. The article says, “The Super...
European Market Analysis
Regional News Kazakhstan and Egypt are working to negotiated trade terms that would allow wheat to trade from the former country to the latter. The two countries are reportedly working on resolving issues that prevent Kazakhstan from participating in GASC tenders and are discussing the pos...
CFTC COT Report Analysis
Through 15 October, funds reversed their short covering trends and emerged as net sellers in the soybean, corn, and soymeal markets after the bearish October WASDE and shift towards wetter weather in South America. Funds doubled their short position in soybean futures and are now short a small...
Market Commentary: Harvest Pressure Outweighs Demand
There was modest to lower volume generally today, except in wheat where there was a gang beating. Wheat closed lower in the overnight, opened lower this morning, and sealed the deal with losses at the close. Soyoil was treated similarly but soybeans and corn each were higher in the overnight an...
Food Inflation and the Food Service Sector
September retail sales rose slightly more than expected and the underlying details of the report were solid. Sales rose 0.4 percent in September versus a consensus expected rise of 0.3 percent, while revisions to the prior months’ activity pushed the overall gain to 0.5 percent. The monthly inc...
Cow-Calf Margins Outperform Forecasts, Imply Herd Rebuilding
With the start of the fall weaning and marketing program for most of America’s cow-calf producers, we’re starting to see the first realized profits for the sector this year. From January through September, WPI’s cow-calf profit models are built upon the assumption that most producers will marke...
Market Commentary: Turnaround Thursday on Exports, Weather
Bears started out the week in full control of the CBOT, but their grip loosened on Thursday and bulls managed to post at turnaround in several markets. Chief among the turnaround was corn futures where an early dip below $4.00 in the December contract triggered short covering and some commercia...
Livestock Roundup: A Look at Cattle Herd Rebuilding
As WPI reported yesterday, the total supply of beef per capita is up this year over last based on imports and heavier slaughter weights; both are related to the pace of beef cow salughter. A bigger percent of fed cattle in the mix has resulted in heavier slaughter weights, as well as feeder cat...
Oilseed Highlights: Under Pressure but Hovering
The MarketToday’s IGC report increased the growth in global soybean carryout and thus reinforced the bearish trend in the November futures contract. There are still counterfactuals such as Brazil’s delayed planting, low moisture U.S. pods, plus wilt (Fusarium oxysporum) and Brown stem rot (Cada...
State Control of Markets – Russia; State Control of Markets – U.S
State Control of MarketsRussia’s agriculture ministry recently “suggested” that grain exporters not sell wheat internationally below the minimum price of $250/MT FOB. The minimum price approach is less clumsy than export quotas but is a harder stop than Moscow’ use of export taxes to try and ma...
Market Commentary: Corn Rallies on Export Sales; Bean Bears Return in Heavy Options Trade
The CBOT was mixed on Wednesday with corn rising after the USDA reported “flash” export sales of over 1.9 MMT of corn to Mexico and unknown destinations combined. The news put a bid under futures and caused corn spreads to firm slightly with funds buying back some of what they sold earlier this...
The Black Sea Regional Analysis
Russian Grain Markets: 7 – 11 October 2024The world has been watching the 2024 Russian grain harvest forecasts, especially wheat production. The Russian Ministry of Agriculture was not making any sharp moves in one direction or the other, while domestic analysts have revised the 2024 grain crop...
Asymmetric on Tariffs
Most economists are clear in describing tariffs as a border tax. Their impacts include increasing costs on consumers and reducing trade, and thus self-harming a nation’s economic well-being. Yet, it is difficult to identify a nation that doesn’t use tariffs, and most utilize them more than the...
Market Commentary: Bears Win Again, but Crush Report Buoys Soybeans
Bears were in control of the CBOT for the second straight day with very few bullish news items seeming to exist on the horizon. Between improving weather forecasts for the Northern Hemisphere, lower threat of a La Nina this year, strong harvest progress in the U.S., large crop forecasts for Bra...
Middle East, Mediterranean and Africa Regional Analysis
Regional Updates MEDITERRANEAN/MIDDLE EAST/NORTH AFRICA/AFRICA – MEA REGION Algeria decided to bar French companies from its wheat import tenders due to France’s support for Morocco’s continued sovereignty over the Western Sahara region. All tender participants have been advis...
Planned Website Downtime Wednesday, 16 October
WPI is completing a series of upgrades to our website that will require about 50 minutes of downtime on Wednesday, 16 October starting at 12:00 PM EDT. There is never a “good” time for a website to be down, but this was deemed to be among the least disruptive to our U.S. and interna...
Red Meat and Poultry Situation
As WPI reported last week, the October WASDE increased its projection for beef production by 205 million pounds on higher slaughter and heavier carcass weights and increased the 2025 forecast for beef production by 300 million pounds. Nonetheless, October slaughter is starting slowly. Total sla...
Farm Subsidies on the March
Subsidies can increase output and there are many ways to subsidize an industry, but that doesn’t mean that countries should do it. Cost of Production: The EU badly wants to become self-sufficient in plant protein. More than four decades ago Europe lost a dispute settlement cas...
Market Commentary: Bears Gain Control; Soybeans End Below $10, Corn Breaks Support
Bears regained control of the CBOT ag market trade on Monday, seemingly not because of the WASDE but rather because of shifting weather forecasts and apparently receding threats. The weather in South America is trending more favorably for the corn and soybean crops down there, and showers in th...
Politics: Will 2024 Election Yield an Unprecedented Triple Flip?
The 2024 election is three weeks from tomorrow. This cycle has been unusual. The campaign started as a Biden versus Trump rematch of the 2020 campaign, the first such rematch since 1956 (only the seventh time in history and only the second time since 1900). However, President Biden stepped down...
European Market Analysis
Regional News Political tensions between Algeria and France reportedly prompted the former country to exclude its traditionally favored European trading partner from a recent wheat purchase tender. Algeria in its latest tender specifically requested no submissions from France and purchase...
Mercosur Regional Analysis
Wheat After weeks of anticipation, rains finally arrived in the most needed areas of Argentina. At the beginning of the week, the central and northern parts of Córdoba, central and northern Santa Fe, and parts of Entre Ríos received significant rainfall. Toward the end of th...
Going up with a Bang
A futures contract that persistently moves up or down by just a penny or two each day imposes its own burden on the market. While speculators are said to prosper from volatility, and sellers want higher prices and buyers prefer them lower, everyone prefers a story. Apparently, the cotton market...
CFTC COT Report Analysis
Through 8 October, funds continued to exit their formerly massive short positions in corn and soybean futures and now hold a small fraction of that commitment. Funds covered 40 percent of their short position in soybeans and are now only short 18,000 contracts. Similarly, funds bought back half...
WASDE Wheat
WPI offers the following PDF of key supply and demand tables and charts relating to the USDA’s latest WASDE report. This is not an all-inclusive compilation of relevant market factors, only those which we feel are of top priority. WPI will seek to expand the offerings in this report and w...
WASDE Soybeans
WPI offers the following PDF of key supply and demand tables and charts relating to the USDA’s latest WASDE report. This is not an all-inclusive compilation of relevant market factors, only those which we feel are of top priority. WPI will seek to expand the offerings in this report and w...
WASDE Corn
WPI offers the following PDF of key supply and demand tables and charts relating to the USDA’s latest WASDE report. This is not an all-inclusive compilation of relevant market factors, only those which we feel are of top priority. WPI will seek to expand the offerings in this report and w...
Market Commentary: Only Pork Survives the WASDE Intact
The U.S. crop situation for 2024/25 was largely firmed up by today’s USDA October WASDE report. Net, net – there is a lot of grain available. Not enough for any precipitous drop in prices today, but only Lean Hogs managed to end the day higher. Today’s report reinforced...
WASDE Outlook for Livestock: More Beef
Today’s WASDE increased the price outlook for 2024 fed steers after dropping it in September. The September WASDE dropped the fed steer price by $3/cwt to $185.11/cwt from the month prior. Today the price forecast was adjusted up $1/cwt. The forecast for the 2025 annual...
Cocoa Market Update: Prices Rise as Stocks Fall
At the end of July 2024, WPI published an article looking at the drivers of the cocoa market’s massive rally in 2023 and 2024 and that offered an outlook for MY 2024/25. This article offers a brief update on market conditions and developments that have occurred in the two months since our...
Market Commentary: Wheat Rises as Russia Considers Export Ban; Cattle Extend Rally
The CBOT saw wheat emerge as the upside leader for the day with multiple bullish stories offering support, including one from Reuters that indicates Russia may be considering a ban on grain exports. Details are nonexistent, but there is reportedly a meeting soon between the ag ministry and grai...
Oilseed Highlights: Pre-WASDE but Relatively Firm
The Market The soybean market has been sliding heading into tomorrow USDA October WASDE report. The trade has positioned itself in the middle of the September trading range and is still positioned in a somewhat bullish position slightly above the 50-day trading average. The market has been tren...
Livestock Roundup: Red Meat Exports
August trade data was released yesterday. High prices of U.S. beef exports have kept exports down. Compared to August 2023, total exports were 102,682 MT, which was the lowest monthly total since January. For the first eight months of the year, January through August, exports at 856,834 MT were...
Market Commentary: CBOT Trades Weather and WASDE Expectations
Trade at the CBOT on Wednesday was dominated by two factors: global weather and preparations for the October WASDE report, which will come out on Friday. The weather was mostly relevant for wheat as parts of Russia, Ukraine, Australia, and the U.S. Plains battle persistent and increasingly dry...
Policy Potpourri
Good Many Organisms: The Nobel Prize in Chemistry was awarded this week to scientists at Google DeepMind using AI to predict the structure of proteins and inventing new ones. Capitaslizing on the opportunities, Ginkgo Bioworks announced that it would make available to researchers its API that u...
Say Cheese!
Ilena Peng from Bloomberg has written about the expansion of U.S. cheese exports. Former French President Charles de Gaulle once noted that his country has hundreds of different cheeses and the U.S. had hundreds of different religions. But the U.S. has since become a major producer of many diff...
Black Sea Regional Analysis
Russian Grain Markets: 30 September – 4 October 2024 The first week of September proved bullish in European Russia and slightly bearish in the Asian part and Siberia. The weather factor is important but it’s not the key driver. It may become the decisive factor later on depending on...
Market Commentary: Brazil Rains, Crude Oil Selloff Sink Soy Complex; Cattle Extend Rally on Beef Demand
Trade at the CBOT was mostly lower on Tuesday with the soy complex leading the way south as weather models show more promising rains for South America. Soybeans turned sharply lower on the forecasts and scored a bearish technical day on the chart, with additional selling pressure coming from th...
War on Food Companies; Holding Back the Future
War on Food Companies Market skeptics like U.S. Senator Elizabeth Warren (D-Massachusetts) have stepped up their attack on food companies by accusing them of price gouging by “squeezing profits out of consumers” through shrinkflation and avoiding federal taxes. They charge that comp...
USDA Announces Cattle Price Discovery Rule
Today, the Biden Administration issued an Advanced Notice of Public Rulemaking (ANPR) on Price Discovery and Transparency in Markets for Fed Cattle. This is the fifth livestock and poultry market regulation put forth under the Packers and Stockyards Act (P&SA) and under the Biden Executive...
Middle East, Mediterranean and Africa Regional Analysis
Regional Updates MEDITERRANEAN/MIDDLE EAST/NORTH AFRICA/AFRICA – MEA REGION Egypt has a program that it says will reduce wheat imports and cut subsidies on bread. The plan is to blend wheat flour with local corn and sorghum flour. Savings, it is said, could be in the hundreds of millions...
Market Commentary: Harvest and Weather Pressure Continue
Clear weather and rolling combines in the Northern Hemisphere together with prospective showers in South America maintain pressure on commodity futures. However, volume today was relatively low except in soybeans and livestock. While soybeans closed lower, the end of Golden Week and China&rsquo...
Allowing Private Contributions to Conservation Programs to Create Public Assets
USDA’s Natural Resource Conservation Service (NRCS) closed the comment period for the implementing rules for the Sponsoring USDA Sustainability Targets in Agriculture to Incentivize Natural Solutions (SUSTAINS) Act last month. The Act authorizes USDA to accept private contributions to cha...
Mercosur Regional Analysis
Wheat Despite the lack of rain, the Buenos Aires Grain Exchange maintains its outlook for this season’s wheat crop. As we mentioned previously, the rains in August and September were disappointing, and thus far in October they’ve been absent. Additionally, we are seeing rising tempe...
2024/25 Corn Outlook: Strong Demand Shifts Prices Higher
In light of the surprisingly bullish Grain Stocks data, WPI has updated our quarterly corn market outlook to reflect the supply and demand trends reflected in the USDA’s most recent data. Since the September edition of our quarterly outlook, WPI’s forecast has shifted to feature sma...
Market Commentary: Next Week’s Weather Makes or Breaks
It was another day lower for the grain and oilseeds sectors, and another day of weak volume for corn and the soy sector. The causes have not changed: A strengthening dollar Very good harvest weather in the U.S. Potentially better weather in South America late next week If good rains materiali...
U.S. Soybean Crush Margin Outlook
The recent strength in U.S. soyoil and soymeal prices has helped push “board” crush margin (i.e., the margin implied or calculated by CBOT futures contracts) to new highs with the VVX margin hitting $1.62/bushel and the HHH margins topping the $1.45 mark for the first time in over a...
Port Strike Suspended: A Look at Short-Term and Long-Term Issues
East and Gulf Coast port workers are back on the job today after striking on 1 October. Many of the affected ports will add weekend overtime hours to load trucks; several ports will remain closed to trucks today as containers are offloaded to prepared for resumptions of trucking. Importers repo...
WPI Website Restored
Apologies to those that had trouble accessing WPI's website and analysis articles. Service has now been restored. Please advise if you are still having any issues and thank you for your patience during this technology glitch. ...
Market Commentary: Multiple Influences from Macros to Weather
The somewhat bullish influence of Monday’s stocks report has now fully faded. The market today pretty much ignored a solid USDA Export Sales report and instead focused on mostly bearish factors: The EU is postponing enactment of its deforestation policy. Macro jitters around the Middle E...
Oilseed Highlights: EUDR Decision and South American Weather Weigh on Complex
The Market It has been a tough week thus far for soybeans and meal. The EU’s decision to delay its European Union Deforestation Regulation (EUDR) means there will be no break for U.S. exporters in competition from South America and Southeast Asia. The two days of decline have November soy...
Livestock Roundup: Broiler Outlook
Hatcheries set 242.69 million eggs in incubators during the week ending 28 September, up 6.1 percent from a year ago. So far this year, egg sets are up 1.9 percent over last year, and to date through the second half of the year are up 3.5 percent. Last year, eggs set started trendng lower in J...
Coffee Rally Stalls as Weather Shifts, Bear Move Ahead?
Coffee futures have been on a massive rally in 2024 with the ICE “C” contract rising above $2.60/lb last week, breaching that point for just the fifth time since 1970. The catalyst for the rally has been well reported this year, with declining stocks and weather issues in major prod...
Market Commentary: Wheat Jumps Higher on Massive Egypt Imports; Soymeal Falls on EUDR News
Wheat remains the darling of the CBOT with more bullish news pouring into the complex. Today’s rally was sparked by reports that Egypt has booked over 3 MMT of wheat from the Black Sea (presumably Russia) to be exported over the next six months. That move comes as Russian wheat stocks are...
Ludditic Longshoremen; Symptom not Disease
Ludditic Longshoremen Labor strikes are always about money, working conditions and job protection but the latter is skyrocketing to the top. The U.S. East and Gulf Coast port workers’ strike is a prime example. Automation is threatening the number of longshoreman positions needed, and the...
Kenya’s Crop Choices
In yesterday’s WPI Middle East, Mediterranean and Africa Regional analysis report, it was noted that Kenyan farmers are switching from growing maize to growing sweet potatoes. The latter being easier to grow than drought sensitive maize and netting three crops per year. But whether maize...
Black Sea Regional Analysis
Russian Grain Markets: 23–27 September 2024 The Russian grain market was bullish in European Russia but bearish in the Asian part and Siberia because Kazakhstan introduced a temporary ban on imports of Russian wheat. Grain storage facilities are being filled up to the brim with new crop c...
Market Commentary: Grain Stocks Fuel 2-Day Corn Rally; Wheat Rises with Russian Prices
CBOT grains and oilseeds seem to be playing “follow the leader” and have recently switched roles. Previously, soybeans were rallying and pulling grain futures grudgingly higher, but that has completely flipped following Monday’s Grain Stocks report. Now, corn and wheat are ris...
Trade Policy Spin; Interstate Trade Barriers
Trade Policy Spin It is an election year, and the Biden Administration is claiming to have opened up $26.7 billion in overseas market access for American farmers. But that carries the same weight with farmers as grocery buyers hearing that food inflation has declined. They are still paying more...
East and Gulf Port Workers on Strike
A port worker strike in the U.S. East Coast and Gulf Ports started today affecting container shipments, while a strike in Vancouver, Canada affecting grain shipments came to an end on Saturday with the final ratification vote to come this Friday, 4 October. As WPI’s Matt Herrington...
Middle East, Mediterranean and Africa Regional Analysis
Regional Updates MEDITERRANEAN/MIDDLE EAST/NORTH AFRICA/AFRICA – MEA REGION Pakistan’s wheat imports in 2024/25 could drop to almost nothing as a result of the very good harvest in 2024 – up by 3.2 MMT. Wheat production was well above the average at a record level of 31,400 MM...
Market Commentary: Grain Stocks Bullish Corn but Neutral Soy, Wheat; Port Strike Looms
Monday’s CBOT trade was essentially dedicated to the Grain Stocks report with pre-report trading seeing muted action and steady volumes while post-report trade saw a meaningful rally in corn and a pullback in soybeans. The report issued a surprisingly small corn stocks figure, which spurr...
Hurricane Helene Impacts in the Southeast
After making landfall along the Gulf Coast of Florida, Hurricane Helene struck northeast Georgia and western North Carolina. All commodities in the region have been affected, including pecan orchards and timber land, but also corn, soybeans, cotton and poultry. Given the location, hog pro...
Green for You, Grey for Me; Slaying National Champions
Green for You, Grey for Me Some say the EU has been vague about whether it will seek a delay in the December 30 implementation deadline for implementing the EU Deforestation Regulation (EUDR). Brussels told WTO members last week that delay would require a legislative change, which is not imposs...
Russia’s Grain Shortfall
Today’s USDA quarterly Grain Stocks report provided the market with a bullish input but there may be another shoe to drop. Russia’s stocks to use ratio for corn and wheat have been dropping for four straight years. Over that timeframe, it is down 64 percent for corn and 48 percent f...
Mercosur Regional Analysis
Argentina’s Weather The weather remains a recurring issue in Argentina. The lack of rainfall across much of the country's agricultural region is starting to impact both the wheat crop, currently in its yield-defining stages, and the sowing of summer crops. Precipitation anomaly maps...
European Market Analysis
Regional News Four regions in Russia’s Siberia have declared states of emergency due to heavy rains and flooding. Milling Wheat Wheat markets were higher last week with U.S. futures rising about $5/MT while the Paris market added €1.25/MT for the week. Markets remain conc...
Grain Stocks Report Charts
The attached PDF offers graphical depiction and analysis of the latest USDA Grain Stocks data for key commodities. The data is, of course, taken from the quarterly Grain Stocks report. WPI recently completed an expansion of the analysis and welcomes any feedback/suggestions. ...
CFTC COT Report Analysis
Funds activity in the ag futures markets was more subtle than expected for the second straight week. Specifically, fund short-covering in the corn and wheat markets lagged expectations by a wide margin. In corn futures, funds bought back 3,700 contracts (2.6 percent) of their prior short, which...
Market Commentary: Pre-Report Plus Brazil Lightens Risk
Volume was light except in soymeal, Feeders and lean hogs. USDA’s final quarterly stocks report for MY 2023/24 arrives Monday and it has surprised to the bullish side for the past four out of five years. So the goal was to get out of short positions. On the week, soymeal exploded on...
Policy Quick Hits
Government Funding President Biden yesterday signed a continuing resolution passed by Congress to fund the government at current levels until 20 December. There were no riders – such as an extension of the farm bill – included. This sets up another deadline before the Christmas holi...
Cow-Calf Margins Down from July but Still Imply Herd Rebuilding
Since WPI’s July update on cow-calf margins, expected 2024 returns for producers have shifted lower but remain well above year-ago values and near record highs. WPI’s models indicate that revenue for the “average” Southern Plains (i.e., Kansas) cow-calf operation will hi...
Nudge versus Cudgel; New Japanese PM; Pesticide Restrictions
Nudge versus Cudgel The Biden Administration has achieved some market openings in various countries, the most recent being obtaining agreement from Chile to accept American cheese products marked with European origin names like gouda, cheddar, and provolone. Chief Agricultural Negotiator Doug M...
Market Commentary: Crude Oil Selloff Sinks Soyoil, Soybeans; Corn, Wheat Lower Ahead of Stocks Report
A surprise selloff in crude oil put heavy selling pressure on the CBOT soy complex on Thursday, with soyoil and soybeans scoring bearish reversals for the day. The weakness in the soy complex sent corn and wheat into the red as well, with traders unwilling to take more long risks heading into t...
Oilseed Highlights: Weakness Today But Still Plenty of Support
The Market The soy complex has had a bullish week thus far, moving higher on a weather premium added for Brazil, and news that China, the largest importer of soybeans, will significantly boost economic stimulus. Short-covering had been rampant until today’s selloff. News that Saudi Arabia...
Livestock Roundup: Hogs and Pigs Report Mostly Neutral
Today, USDA released its quarterly Hogs and Pigs report for the June through August quarter. The total inventory of hogs and pigs on 1 Spetmeber was 76.48 milllion head, which was up from 76.133 million head in 2023. Typically, inventories grow from 1 June and peak for the ye...
Market Commentary: Soyoil and Beans Lead Sector Higher
The CBOT was higher once again with soybeans and the oilseed complex leading the way. Drought in Brazil and the surging soyoil prices have supported the complex and driven a widespread wave of short-covering by funds. Corn and wheat futures followed the oilseed markets higher at midweek but fai...
Industry Consolidation
U.S. antitrust law is complicated, but current efforts to block a merger between grocery retailers Albertsons and Kroger may not fit the bill. Current triggers under the law include: Market share of 70 percent or more, or less than 50 percent if barriers limit competition. Barriers to entry pr...
Black Sea Regional Analysis
Russian Grain Markets: 16–20 September 2024 Russian grain markets remained stagnant as export demand is weak and domestic demand is even weaker. Moreover, appreciation of grains earlier in the month reached its peak at this stage of the game and buyers are very careful right now. Sellers...
Market Commentary: Soybeans, Soyoil Extend Rallies; Wheat, Corn Fall as Short-Covering Fades
The CBOT saw diverging trading patterns on Tuesday with soybeans and soyoil continuing their rallies and extending gains to new highs. China is rumored to be purchasing up to 1.2 MMT (44 Mbu or 20 cargoes) of U.S. soybeans for October-November delivery, which put a bid under the market. Too, th...
Hogs and Pigs Report Preview
On Thursday, USDA will release its quarterly Hogs and Pigs report for the June through August quarter showing the inventory as of 1 September. Pre-report expectations peg the total inventory at 100.5 percent of last year. That would imply 75.7 million head, the largest inventory for the quarter...
Tariff Spiral and WTO Failure; Nuclear Power and GMO’s
Tariff Spiral and WTO Failure Republican presidential nominee Donald Trump now says he will impose 200 percent tariffs on farm machinery from John Deere should the company move its manufacturing to Mexico. He said he would also provide incentives for foreign companies to move their operations t...
Energy and Agriculture
Global agriculture produces energy, with 23 percent of ethanol produced from sugarcane, and another 7 percent produced from the molasses byproduct of processing sugarcane or sugarbeets. Increased production of ethanol has caused global sugar carryover to decline. Agriculture is also a major con...
Middle East, Mediterranean and Africa Regional Analysis
Regional Updates MEDITERRANEAN/MIDDLE EAST/NORTH AFRICA/AFRICA – MEA REGION Bangladesh reports that it will be importing 400,000 MT of wheat immediately with the normal buying approval being shortened from 42 days to 15 days. The change is being made in order to maintain food security. Th...
Market Commentary: CBOT Rallies on Weather, Short Covering; Monetary Policy Turns Bullish Commodities
The CBOT jumped sharply higher to start the new week with wheat leading the move with overnight strength. Fund short covering drove much of the day’s gains, but dryness in Brazil and the Black Sea, along with some rain-induced U.S. harvest delays, offered some fundamental motivation...
Hypocritical on Process Standards; Buy America Bust; Politics of the Port Strike
Hypocritical on Process Standards EU Commission President Ursula von der Leyen will make a decision this week on implementation of the EU Deforestation Regulation. It is set to take effect at the start of 2025 but both internal and external forces want the measure delayed and modified. That inc...
Pending Port Strikes: U.S. East and Gulf Coasts and Vancouver Canada
With a pending 1 October strike deadline on the U.S. East and Gulf Coasts by the International Longshoreman’s Association (ILA), the U.S. Department of Labor has reached out to the U.S. Maritime Alliance (USMX), a group that represents employers of the East and Gulf Coasts longshore indus...
Running Out of Protein
Europe ran out of energy when the Russian attack on Ukraine forced it to reduce imports from Russia. Europe lacks the ability to defend itself despite Russia’s threat on its eastern border. Now Europe is reducing its consumption of meat but failing to invest in meat alternatives that coul...
European Market Analysis
Regional News WPI sources in Brussels say it’s increasingly likely that the EU Deforestation Regulations will be delayed until the region can develop better implementing systems. Recall that EUDR – which would force massive reporting and traceability requirements on seven comm...
Mercosur Regional Analysis
Argentina Economic/Policy Update Argentine President Javier Milei, in a public speech this week, presented the 2025 budget that will be sent to Congress for approval. Farmers had high expectations for potential announcements that might improve their business or provide visibility concerni...
CFTC COT Report Analysis
Funds activity in the ag futures markets was more subdued last week than expected. Funds were slight net buyers in soybeans, soymeal, corn, and across the wheat complex, but the percentage shifts in their positions and overall buying volumes underperformed expectations. In the soy complex...
Market Commentary: Today was Green but Headwinds for the Week
Corn, soymeal, live cattle and lean hogs all traded lower during the morning start but by the end of the day, only lean hogs ended lower. There were modest volumes being traded on Friday for most contracts, except feeder cattle where it was nearly double the five-day average.December soymeal hi...
Cow-Calf Margins Steady in November, Herd Expansion Still Likely
Despite recent decreases in feeder cattle futures and rising feedstuff costs, estimated cow-calf producer margins are largely unchanged from WPI’s October estimate. The stable and positive financial environment means that producers are still facing strong financial incentives to expand the U.S...
McSustainability Through Feed Efficiency
McDonalds has entered the sustainability space by partnering with Syngenta and paying cattle producers to use Syngenta’s Enogen Trait corn to improve feed efficiency. Enogen corn contains an enzyme, alpha amylase. This enzyme has been added during the ethanol production process to induce starch...
Livestock Roundup: Turkey Production Adjusted Down
Turkey production in August totaled 434.7 million pounds, slightly above July production but down 11 percent year-over-year. August slaughter was down 15 percent year-over-year, but heavier weights in August (32.25 pounds) offset the reduced slaughter. Based on the August production data, estim...
FOB Prices and Freight Rates App (Updated 15 November)
Ocean Freight Comments - 15 November 2024By Matt HerringtonDry bulk freight markets were mixed this week with Capes rising while Supramax vessel rates declined yet again. The Capesize sector found support from China’s recent efforts to stockpile coal and iron ore, but this support has not yet t...
Market Commentary: Biofuel and Trade Policy Worries Pressure CBOT along with Dollar Strength
The CBOT saw another day of pronounced weakness with expectations for larger global soybean and wheat production and stocks in 2025 weighing on values. Product demand in the soy complex has also been a huge negative factor recently with uncertainty over U.S. biofuels policy causing a sharp redu...
Oilseed Highlights: Multi-Bearish Factors
The MarketThe January soybean contract has been sliding all week and despite support at the 20-day moving average of $10.01/ST, it closed today below $10/bushel for the first time this month. The reasons are many including: a rising dollar value, 2) large impending South American production, 3)...
Market Commentary: Bearish Beat Goes On
The CBOT was essentially all red on Wednesday with traders finding little support from either the fundamental or technical components of commodity price analysis. Wheat was the downside leader for the day as a strong dollar, improving conditions in the Plains, and increasingly tepid exports fro...
EU Studies Trading Houses
As part of its witch hunt for unfair market practices, the EU Parliament’s AGRI Committee requested a study of the major agricultural commodity trading companies and their impacts. The study may inform populists in the U.S. that also see consolidated industries as inherently harmful, but...
USA Gone Nuts
While oilseeds receive much of the attention, tree nuts, which are technically a seed and containing oil, have gone even more gangbusters for U.S. producers in recent years. Almonds have received much of the focus as the U.S. produces nearly 80 percent of the crop and a comparable share of the...
Black Sea Regional Analysis
Russian Grain Markets: 4 – 8 November 2024We have heard the voices from various sources forecasting a new grain crop in Russia and most of them differ in numbers. We will have to deal with terminology like bunker weight (straight from the combine) and standard weight (cleaned and dried accepted...
WPI Crop Progress and Conditions App (Updated 12 November)
Update for 1 April 2024: Last year, users pointed out differences between the 5-year averages reported in this app and what USDA estimates in its weekly report. The difference exists because WPI calculates average based on the last 5 years of observations for the current week. In cases where ob...
Market Commentary: Funds Resume Soy Complex Selling; Wheat Falls on Improved Weather
The CBOT was almost uniformly in the red on Tuesday with any bullish supply-side implications from the November WASDE largely forgotten (or ignored) amid bearish demand-side developments. The recent rally in the U.S. dollar is threatening to undo much of the export demand gains the market has w...
Cuban Pipedream
Some in the U.S. agriculture community have spent years trying to improve sales to Cuba, which have increased though from a very small base. Now there is even less reason to think they’ll succeed. Their pipedream has been a hungry population of around 11 million people just 60 miles off the Ame...
Trump’s Tariff Plan; Whither Europe; RTO Beats WFH
Trump’s Tariff PlanFew things attract more speculation than how President-Elect Donald Trump will model his plan to increase tariffs on imports. Some economists have taken his most exaggerated claims and predict they will cause slower economic growth and higher inflation. At least one advisor s...
Political Landscape Taking Shape
After the 2024 elections, the Republicans look to have taken control of Congress, along with a Trump victory, providing a Republican triple sweep. The Senate GOP majority is 53 to 47; and the House GOP majority is still TBD. However, as of today, the Republicans have secured 215 seats, and Demo...
Middle East, Mediterranean and Africa Regional Analysis
Regional UpdatesMEDITERRANEAN/MIDDLE EAST/NORTH AFRICA/AFRICA – MEA REGIONPakistan has decided to allow the importation of GMO soybeans from the U.S. – critics say that this decision was made without proper risk assessment and was only done due to pressure from large industrial companies. Forty...
Livestock Industry Margins
WPI is excited to present the latest edition of our newest data-driven publication Ag Perspectives Quant: U.S. Livestock Industry Profit Margins. This report offers a comprehensive look at the profitability of the U.S. beef and pork sectors, from cow-calf and farrow-to-finish producers up the v...
Market Commentary: CBOT Slips as Demand Worries Overtake Supply-Side Surprises
The November WASDE offered mixed influences for the major ag markets with USDA making surprise cuts to the U.S. corn and soybean crops and ending stocks, which rallied markets on Friday. The report also, however, cast doubts on the demand-side outlook for both crops and wheat, and that is what...
Deep Bench to Fight RFK; China Market Risk; Thankless Job
Deep Bench to Fight RFKBeing the U.S. Secretary of Agriculture is usually a pretty good job. It involves doling out billions of dollars, the constituency is dominated by courteous country people, and controversies tend to be minor. The person serving the longest in any Cabinet position was Jame...
Rice as a Stable Crop
Last year, India restricted non-Basmati rice exports believing there would be a weather-related short supply. Production was ample and now the country faces record high inventories that will likely be dumped on the world market. The OECD calculates that Indian farmers are implicitly taxed $120...
Senate Committee Changes and Ethanol Legislation
As WPI noted a week ago on 4 November, As a general rule, a Republican agenda is likely to be friendlier to liquid fuels, especially petroleum fuels, whereas a Democrat agenda is more likely to include a role for electric vehicles, and a renewable fuels policy that will focus on reducing c...
Mercosur Regional Analysis
Wheat As of the end of the first week of November, 12 percent of Argentina’s sown wheat area has already been harvested. Harvesting is progressing quickly in the country’s north, with yields that are low but within expectations. Although a few more weeks will pass before the harvest is wid...
CFTC COT Report Analysis
The major finding of Friday’s CFTC report was the confirmation that funds have officially flipped their formerly massive net short in corn to a net long. After buying back nearly 40,000 contracts last week, funds now sit long 3,035 contracts as of 5 November, a position which was extended signi...
Market Commentary: Somewhat Tumultuous WASDE
The November WASDE report usually involves some tweaking of the numbers by USDA, and that is all it mostly was today, but with some quirky impacts. First, there were a few surprises but not dramatic ones and yet the report spurred larger to outsized volume in trading across the grain and oilsee...
Who Might Be the Next Ag Secretary?
As most Presidents-elect do, former President and President-elect Donald Trump has named his new White House Chief of Staff as his first appointment. It is Susi S. Wiles. Wiles was the co-manager of Trump’s 2024 campaign, and also was a key strategist focused on Florida in his 2016 and 2020 cam...
WPI 2025 Hog and Pork Outlook
U.S. hog producers saw a mixed year in 2024 with early-year prices bringing poor profitability while the dramatic hog rally since the summer has lifted financial fortunes significantly. A major component of those rising prices was the unexpected surge in pork demand, which pushed the cutout to...
Market Commentary: Soybeans, Soyoil Rally on Export Numbers; Cattle Gain on Macro Strength
The CBOT was mixed on Thursday following the news of Donald Trump’s election to President of the United States with markets, particularly corn and cattle futures, seeing continued support from “risk on” trade. It’s not necessarily that traders and investors are particularly excited about Trump’...
Transatlantic Trade War; Traders Beat Pollsters; Transatlantic Lesson
Transatlantic Trade WarU.S. equity markets rose yesterday on news of Donald Trump’s victory, while shares in Europe fell. The EU is America’s biggest trading partner and Trump promises tariffs. EU officials are strategizing on how to deal with a Trump presidency, with some urging cooperation, a...
Livestock Roundup: Beef Overview
Little to no action has been reported in the cash markets and asking prices are back at $190/cwt and higher. Cattle supply numbers are tighter in the south than in the north, and carcass weights took a pause from the steep rise that has taken them to all-time highs this year. The latest report...
Oilseed Highlights: On an Upswing
The MarketThe January soybean contract is up 3.2 percent on the week and has is now up 3.5 percent from its late October low at 979/bushel, but it is still 5 percent below its late August high at 1083/bushel.11072024oilseeds_beans.png 1.16 MBUntil today’s turnaround following very large export...
Market Commentary: Mild Election Impacts
Outside markets closed higher and the dollar was up, but not because of bullishness over Mr. Trump’s victory. The business sector likes his pledge for lower taxes and less regulation but is less enthralled with his attraction to tariffs. In fact, the tariffs are expected to be inflationary, cau...
The Day After
The political establishment in Washington is stunned following yesterday's rout by Donald Trump and the Republicans. The Democrats’ arch nemesis not only survived everything they threw at him, but he also took an increasing share of the minority voting block that they claimed as their own. It w...
WPI Preliminary 2025 Acreage Forecasts
The polling for the 2024 U.S. Presidential election had significant forecast errors and history will likely judge the numbers as “wrong”. While it’s hard to argue against such judgement when the results proved a historic sweep for Trump versus predictions of a tight race, the pre-election polls...
Black Sea Regional Analysis
Russian Grain Markets: 28 October – 1 November 2024Russian analysts revised the 2024 Russian crop downwards to 128.8 MMT without newly occupied territories but with Crimea which was occupied a decade ago. This new forecast is down 11 percent from the previous year. Wheat is at 85.6 MMT – down 8...
Market Commentary: Election Day Brings CBOT Gains
It’s election day in the U.S. and the nation will decide on new leadership for the White House and Congress, though results may not be available for days or possibly even weeks. National polls indicate a tight race between candidates Trump and Harris, but betting markets tell a different story...
Tax Policy Outlook Post Election
After the votes are fully counted, as a new Administration forms, and Congress organizes, WPI will take a deeper look into the policy implications of today’s election. From today’s point of view, unless this election is an unexpected blowout (countering polling data that shows it neck and neck...
EU Confirmation Hearings; Japanese Independence; Lemonades out of Lemons; Border War
EU Confirmation HearingsIn a few months, it will be the turn of either Donald Trump or Kamala Harris’s cabinet nominees to seek confirmation by the legislature but this week it is Europe’s Commission designates confronting the hurdle of the European Parliament (EP). Maroš Šefčovič, Commissioner...
Middle East, Mediterranean and Africa Regional Analysis
Regional UpdatesMEDITERRANEAN/MIDDLE EAST/NORTH AFRICA/AFRICA – MEA REGIONTunisia will shortly receive a shipment of 33,000 MT of U.S. corn, the first shipment in quite a while. The U.S. Grains Council office in Tunis says that they expect more U.S. corn imports in the coming weeks.Morocco has...
Livestock Industry Margins
WPI is excited to present the second edition of our newest data-driven publication Ag Perspectives Quant: U.S. Livestock Industry Profit Margins. This report offers a comprehensive look at the profitability of the U.S. beef and pork sectors, from cow-calf and farrow-to-finish producers up the v...
Market Commentary: Grains Rise on Export Demand; Soyoil, Livestock Fall on Technical Trade
The CBOT was mostly higher to start the week with fresh daily export sales announcements and a solid Export Inspections report underpinning the day’s moves. While corn, soybeans, and KC wheat all settled higher for the day, gains were muted as few traders were interested in adding significant r...
Renewable Fuel Policy Outlook in 2025
Tomorrow is election day; the make-up of Congress and who is in the White House is expected to have an impact on renewable fuel policy in 2025. As a general rule, a Republican agenda is likely to be friendlier to liquid fuels, especially petroleum fuels, whereas a Democrat agenda is more likely...
Transatlantic Inverse; Farm Bill Chances
Transatlantic InverseDepending on tomorrow’s election outcome, American businesses will either be saddled with more taxes, regulations, and attacks on consolidation, or be hit with higher import tariffs and maybe the goofy ideas of people like Robert F. Kennedy, Jr. By contrast, Europe has now...
Mercosur Regional Analysis
Wheat The long-awaited rains have finally arrived in southeastern Buenos Aires, with precipitation totals ranging from 20–50 mm. While the rainfall isn’t sufficient to complete the wheat crop, it provides relief to an area where plants were beginning to suffer. For now, it halts the declin...
European Market Analysis
Regional News Algeria bought 600 KMT of wheat in its tender that closed on Monday, buying the full volume permitted, and prices are rumored to be near $263/MT C&F. Traders suspect much of the wheat is Black Sea-origin, given the diplomatic tensions between Paris and Algiers right now...
CFTC COT Report Analysis
Through 29 October, funds continued their aggressive short covering in the corn market with strong export sales justifying the move. Funds reduced their net short position by about 60 percent last week, and now hold a relatively small position of 35,000 contracts short. The continued exit from...
State Directed Meat; Living Space
State Directed MeatUSDA has been issuing loans and grants to startup livestock businesses with the goal of diversifying the industry, providing producers with more options, and lowering the price of meat. Now Pure Prairie Poultry of Minnesota, a beneficiary of $38.7 million in loan guarantees a...
Market Commentary: A Week of Notable Numbers
Except for soymeal, the rest of the grains and oilseeds contracts traded higher in the overnight, and opened higher this morning, but only corn and soyoil ended the day higher. New contract highs were scored today in lean hogs and Malaysian palm oil. A new contract low was marked today fo...
October Jobs Report Tepid
The Bureau of Labor Statistics (BLS) released the October jobs report this morning. Total nonfarm payroll employment was essentially unchanged in October (+12,000), and the unemployment rate was unchanged at 4.1 percent. The pre-report consensus was for an additional 100,000 payroll...
U.S. Soybean Crush Margin Outlook
The three legs of the U.S. soybean crush have each seen interesting and divergent dynamics over the past month that have influenced the crush margin outlook. Notably, soymeal prices have slumped $30/MT lower since early October and are hovering near contract lows just below the $300 mark. Conve...
Market Commentary: CBOT Debates Following Seasonal Rules
The CBOT was mixed for the day with wheat futures sinking lower after the HRW and SRW growing regions received favorable rains Wednesday and early Thursday. That, combined with export pressure from Russia and the Black Sea countries, put wheat on the defensive with funds emerging as net sellers...
Oilseed Highlights: Bounce off the Bottom?
The MarketJanuary soybeans have now rebounded a second day in a row after opening the week lower. While it came within 10-cents of the contract low, exports are booming and most of the bearish inputs (better weather and large South American crops, a weaker real, harvest pressure, and rising glo...
Livestock Roundup: Broiler Outlook
Broiler slaughter was 158.86 million head last week, up from 158.139 million the week before and continuing to run above a year ago. Broiler production in the last quarter of 2024 is forecast to be up 4 percent, bringing the total annual production up 2.2 percent from 2023. Any miss in th...
Market Commentary: End-of-Month Trade, Profit Taking Create Mixed Markets
The CBOT was mixed in moderate-volume trade on Wednesday with markets across the board seeing impacts from end-of-month position adjusting and profit taking. Wheat futures were higher on poor U.S. conditions ratings and drought conditions in the Southern Plains, despite forecasts of rains this...
Misdirected Fire; Over-Capacity
Misdirected FireThe Kamala Harris campaign is frustrated that the economy is hot, inflation has dissipated to just 2.4 percent, and yet voters are not feeling it. Politicians learned long ago to never tell the voters they are wrong and have misperceptions. Consequently, she has been acknowledgi...
Black Sea Regional Analysis
Russian Grain Markets: 21 – 25 October 2024The Russian grain markets remained stable on the export front and slightly bearish after recent peaks. Domestic prices are trying to catch up with export price levels and even in Siberia, prices were recovering. Global pricing effects export prices in...
Market Commentary: Poor Conditions Rally Wheat; Big Crop(s) Pressure Soybeans; Hogs Hit New Highs
The CBOT was mostly higher on Tuesday with the wheat market in the lead on worrying crop conditions and persistent drought in the HRW growing region. USDA’s initial crop ratings for the winter wheat crop were the second lowest for the week since the mid-1980s, which means the rains in the two-w...
Livestock Industry Margins
WPI is excited to present a new, weekly, data-driven publication Ag Perspectives Quant: U.S. Livestock Industry Profit Margins. This report offers a comprehensive look at the profitability of the U.S. beef and pork sectors, from cow-calf and farrow-to-finish producers up the value chain through...
Interest Rate Outlook
The Fed meets next week, the day after the election. It looks likely there will be a rate cut again for the second time in as many meetings. The federal funds futures market is pricing in a 95.4 percent probability of a cut. At the September meeting, Fed members signaled another 50 basis point...
Post-Election Transatlantic
The EU’s dependency on the U.S. for both defense and economic well-being has focused discussions in Brussels on what the relationship will look like should Donald Trump win on 5 November. The Biden Administration initiated a Trade and Technology Council (TTC) in 2021 with designs to coordinate...
Middle East, Mediterranean and Africa Regional Analysis
Regional UpdatesMEDITERRANEAN, MIDDLE EAST, NORTH AFRICA, and AFRICA – MEA REGIONTurkey’s wheat production is seen dropping by 5.5 percent to 20.8 MMT according to Turksat estimates. It also sees barley production down by 11 percent to 8.2 MMT and corn down by 8 percent to 8.3 MMT. Soybean prod...
Market Commentary: Oil Drags CBOT Lower; Hogs Hit New Highs; Cattle Rise After Report
The CBOT was mostly lower for the day with the sharp decline in crude oil futures dragging soyoil, the broader soy complex, and corn and wheat lower. There was little fresh fundamental news to guide commodity futures for the day, which gave the oil market’s plunge an outsized influence on ag fu...
Newsom for President; Fake Meat Lacks Standing
Newsome for PresidentUntil this past Friday, U.S. ethanol producers feared that the California Air Resources Board (CARB) might make an effort to limit the marketing of their products in the Golden State. Now they are singing in the streets as California Governor Gavin Newsom instructed CARB to...
Food Price Outlook Improves
There are often lags in time between when consumers notice a change in the economy, they begin to voice concerns, politicians begin to echo those concerns, and ultimately policymakers take some form of action, if any. Food price inflation is a perfect example of that dynamic. Democratic preside...
RFK Jr Role in a Potential Trump Admin Worrying Aggies
With the election one week from tomorrow, many aggies are turning their attention to the probable role of Robert F. Kennedy Jr. in a Trump Administration should Trump win the election. Over the last week, this is literally the biggest topic of conversation among this analyst’s contacts and sour...
European Market Analysis
Regional News Russia’s winter crops may see 1.5 million hectares (Mha) go unseeded this year due to poor weather in key growing regions. Originally, 20 Mha was expected to be sown to all winter crops. Grain production in 2025 is unlikely to exceed 120 MMT now, due to the acreage reduction...
Mercosur Regional Analysis
Weather Argentina saw continued rainfall throughout last week and so far during October, nearly all of the country’s agricultural regions experienced at least some precipitation. In areas like the Nucleus Region, totals have even exceeded historical averages for October. This rainfall has...
CFTC COT Report Analysis
Through 22 October, funds engaged in the expected short covering in the corn market amid the unexpected surge in exports. Funds’ total buying volume, however, was below expectations at just shy of 20,000 contracts though they certainly added to that number after Tuesday’s data reporting deadlin...
Market Commentary: Mix Week Reflecting Fundamentals
Yesterday’s bullish Export Sales report was followed by more sales of corn and soybeans today. However, there had already been sufficient gains in the futures market this week and current sales are simply on track with USDA’s forecast. The trade does not want to get too far out in front of the...
Cattle on Feed Report
USDA released the monthly Cattle on Feed report today, which was mostly in line with pre-report expectations; only placements came outside of the consensus forecast. 10252024dj.jpg 50.4 KBSeptember marks the beginning of the fall run for cattle placements. Placements last month at 2.156 million...
Forecasting 2025 Cattle Inventories: Small Herd Increases Expected
As WPI has written about several times recently, the beef industry is eagerly awaiting the January Cattle Inventory report from USDA to see whether producers are starting to expand the herd. This information will be valuable for gauging cattle supplies in 2025 and 2026 and will help set pricing...
Market Commentary: Corn, Wheat Rise on Export Data; Soybeans Fall on South American Weather
Exports remain the name of the commodity game this week with all eyes on the UDSA daily “flash” export sales announcements as well as this week’s weekly Export Sales report. On Thursday, both of those factors did not disappoint and gave the already bullish corn market another boost. USDA report...
Oilseed Highlights: Steady Under a Delicate Balance
The MarketU.S. soybean exports have been impressive, but funds continue to focus on South American rains. For the week to date, November soybean futures are higher but cannot maintain a close back up over $10/bushel. They are challenging resistance but remain below the 50-day MA at 1007.25/bush...
BRICS Grain Exchange; Transatlantic Gaslighting
BRICS Grain ExchangeVladmir Putin used his BRICS conference in Kazan, Russia to formally suggest the creation of a grain exchange by the bloc of countries. He said such an exchange could later be expanded to other products and that it would " contribute to the formation of fair and predictable...
Livestock Roundup: Cattle on Feed Preview
USDA will release its Cattle on Feed report tomorrow; the pre-report consensus of analysts’ estimates is for the inventory of cattle on feed as of 1 October to be 99.7 percent of last year; September placements and marketings are expected to be 95.8 and 102 percent respectively of last year’s t...
Market Commentary: More Exports, More Gains
A sixth straight day of daily “flash” export sales announcements from USDA sent CBOT corn and soybean futures higher with funds covering shorts and commercials positioning bullishly too. The export demand for corn caught the market by surprise and has created the current rally, while the season...
Inflation Disconnect; Economic Opinions
Inflation DisconnectEconomists including those at the Federal Reserve use so-called core inflation when assessing the level of rising prices in the economy. Core inflation excludes food and energy prices since they are considered more volatile, and less directly impacted by the Fed’s monetary p...
TFP as Focus
The International Monetary Fund increased its forecast for U.S. GDP growth this year to 2.8 percent, versus 0.8 percent for the Euro Area and the 0.9 percent average for the non-U.S. G-7 countries. Competitiveness is said to be the primary term in Brussels these days, as it should be. The avera...
Mercosur Regional Analysis: Soybeans
Last week, soybean trading saw a lot of activity, particularly with Brazilian old crop shipments and increased movement in U.S. new crop sales. CNF China trade levels began at 240X for the PNW and 255X for the U.S. Gulf, rising rapidly due to several factors. A drop in Chicago futures triggered...
Black Sea Regional Analysis
Russian Grain Markets: 14 – 18 October 2024Russian grain markets remained slightly bullish but not as bullish as a week ago. The biggest concern of all grain exporters is a “threat” from the Russian Grain Export Union that October export prices should be $240/MT and that to make this happen the...
Market Commentary: Exports, Weather Concerns Push CBOT Higher
The CBOT was mostly higher on Tuesday as export demand continues to fuel what looks like the start of a demand-led swing higher in the markets. Tuesday marked the fifth straight business day with a “flash” export sales announcement for corn, with Mexico responsible for essentially all of the de...
U.S. Dietary Guidelines: Booze and Junk Food
Every five years, the Dietary Guidelines for Americans, issued by USDA and the Department of Health and Human Services (HHS) are updated. The new guidelines will be issued next year for 2025-2030. This guidance provides advice on what to eat and drink to meet nutrient needs, promote health, and...
Policy Shortz
U.S. – EU Reset: The transatlantic relationship must be reset after the upcoming election. Brussels produced a state-by-state report on Europe’s trade and investment engagement to help set the environment. U.S. technology firms argue it is ludicrous for Europe to think it can be competitive in...
Bangladesh Food Import Projection
Bangladesh is the third largest food importer in the world. It imports over $15 billion worth of food annually or about 11 percent of its total food consumption. Imports include 5 MMT of grain (3.57 MMT is wheat), plus palm oil, milk powder, and other products. Roughly 3.5 percent of its food i...
The Middle East, Mediterranean and Africa Regional Analysis
Regional Updates MEDITERRANEAN, MIDDLE EAST, NORTH AFRICA, AFRICA – MEA REGIONAfrica spends $75 billion every year importing cereals according to the African Development Bank – 50 MMT being wheat – 27 MMT imported by North Africa, 12 MMT by East Africa and 9 MMT by West Africa. Wheat...
Market Commentary: Exports Rally Corn, Soybeans but Pressure Wheat; Hogs Hit New Contract Highs
The CBOT saw mixed trade again to start the week with a slate of fresh daily “flash” export sales announcements supporting corn and soybeans, as did a generally positive Export Inspections report. That helped soybeans recover from Friday’s drubbing and allowed the corn market to follow through...
Biggest Monopoly; Aggies Challenge Trump; Food Safety Risks and Perceptions
Biggest MonopolyReflecting voter concerns about food inflation, both Harris and Trump are attacking the food system and implying concerns about monopoly power. But no industry is as monopolistic as politics where consumer choice is often limited to just two parties. Voters are near evenly split...
Aging, Shrinking Dairy Herd Tied to Beef Dynamics
There has been much discussion this year to the size of the beef cattle herd. The year started with the lowest overall cattle herd since 1951. Demand for beef, high prices for beef and cattle, and marginal increases in imported feeder cattle have all helped maintain production, as has heavier s...
The Mercosur Regional Analysis
WeatherThe week continued with rain in some areas of the agricultural region that spread water across almost the entire region, ending a 10-day period of instability. The exceptions were the western part of Buenos Aires Province, which received only a few millimeters despite needing more, and t...
Olive Oil Volatility
Bloomberg notes the problems confronting small scale olive oil producers in Spain and Italy. Production is volatile and has been under duress from drought and climate change. As a result, the price has risen, attracting investors who are creating larger scale farms. The article says, “The Super...
European Market Analysis
Regional News Kazakhstan and Egypt are working to negotiated trade terms that would allow wheat to trade from the former country to the latter. The two countries are reportedly working on resolving issues that prevent Kazakhstan from participating in GASC tenders and are discussing the pos...
CFTC COT Report Analysis
Through 15 October, funds reversed their short covering trends and emerged as net sellers in the soybean, corn, and soymeal markets after the bearish October WASDE and shift towards wetter weather in South America. Funds doubled their short position in soybean futures and are now short a small...
Market Commentary: Harvest Pressure Outweighs Demand
There was modest to lower volume generally today, except in wheat where there was a gang beating. Wheat closed lower in the overnight, opened lower this morning, and sealed the deal with losses at the close. Soyoil was treated similarly but soybeans and corn each were higher in the overnight an...
Food Inflation and the Food Service Sector
September retail sales rose slightly more than expected and the underlying details of the report were solid. Sales rose 0.4 percent in September versus a consensus expected rise of 0.3 percent, while revisions to the prior months’ activity pushed the overall gain to 0.5 percent. The monthly inc...
Cow-Calf Margins Outperform Forecasts, Imply Herd Rebuilding
With the start of the fall weaning and marketing program for most of America’s cow-calf producers, we’re starting to see the first realized profits for the sector this year. From January through September, WPI’s cow-calf profit models are built upon the assumption that most producers will marke...
Market Commentary: Turnaround Thursday on Exports, Weather
Bears started out the week in full control of the CBOT, but their grip loosened on Thursday and bulls managed to post at turnaround in several markets. Chief among the turnaround was corn futures where an early dip below $4.00 in the December contract triggered short covering and some commercia...
Livestock Roundup: A Look at Cattle Herd Rebuilding
As WPI reported yesterday, the total supply of beef per capita is up this year over last based on imports and heavier slaughter weights; both are related to the pace of beef cow salughter. A bigger percent of fed cattle in the mix has resulted in heavier slaughter weights, as well as feeder cat...
Oilseed Highlights: Under Pressure but Hovering
The MarketToday’s IGC report increased the growth in global soybean carryout and thus reinforced the bearish trend in the November futures contract. There are still counterfactuals such as Brazil’s delayed planting, low moisture U.S. pods, plus wilt (Fusarium oxysporum) and Brown stem rot (Cada...
State Control of Markets – Russia; State Control of Markets – U.S
State Control of MarketsRussia’s agriculture ministry recently “suggested” that grain exporters not sell wheat internationally below the minimum price of $250/MT FOB. The minimum price approach is less clumsy than export quotas but is a harder stop than Moscow’ use of export taxes to try and ma...
Market Commentary: Corn Rallies on Export Sales; Bean Bears Return in Heavy Options Trade
The CBOT was mixed on Wednesday with corn rising after the USDA reported “flash” export sales of over 1.9 MMT of corn to Mexico and unknown destinations combined. The news put a bid under futures and caused corn spreads to firm slightly with funds buying back some of what they sold earlier this...
The Black Sea Regional Analysis
Russian Grain Markets: 7 – 11 October 2024The world has been watching the 2024 Russian grain harvest forecasts, especially wheat production. The Russian Ministry of Agriculture was not making any sharp moves in one direction or the other, while domestic analysts have revised the 2024 grain crop...
Asymmetric on Tariffs
Most economists are clear in describing tariffs as a border tax. Their impacts include increasing costs on consumers and reducing trade, and thus self-harming a nation’s economic well-being. Yet, it is difficult to identify a nation that doesn’t use tariffs, and most utilize them more than the...
Market Commentary: Bears Win Again, but Crush Report Buoys Soybeans
Bears were in control of the CBOT for the second straight day with very few bullish news items seeming to exist on the horizon. Between improving weather forecasts for the Northern Hemisphere, lower threat of a La Nina this year, strong harvest progress in the U.S., large crop forecasts for Bra...
Middle East, Mediterranean and Africa Regional Analysis
Regional Updates MEDITERRANEAN/MIDDLE EAST/NORTH AFRICA/AFRICA – MEA REGION Algeria decided to bar French companies from its wheat import tenders due to France’s support for Morocco’s continued sovereignty over the Western Sahara region. All tender participants have been advis...
Planned Website Downtime Wednesday, 16 October
WPI is completing a series of upgrades to our website that will require about 50 minutes of downtime on Wednesday, 16 October starting at 12:00 PM EDT. There is never a “good” time for a website to be down, but this was deemed to be among the least disruptive to our U.S. and interna...
Red Meat and Poultry Situation
As WPI reported last week, the October WASDE increased its projection for beef production by 205 million pounds on higher slaughter and heavier carcass weights and increased the 2025 forecast for beef production by 300 million pounds. Nonetheless, October slaughter is starting slowly. Total sla...
Farm Subsidies on the March
Subsidies can increase output and there are many ways to subsidize an industry, but that doesn’t mean that countries should do it. Cost of Production: The EU badly wants to become self-sufficient in plant protein. More than four decades ago Europe lost a dispute settlement cas...
Market Commentary: Bears Gain Control; Soybeans End Below $10, Corn Breaks Support
Bears regained control of the CBOT ag market trade on Monday, seemingly not because of the WASDE but rather because of shifting weather forecasts and apparently receding threats. The weather in South America is trending more favorably for the corn and soybean crops down there, and showers in th...
Politics: Will 2024 Election Yield an Unprecedented Triple Flip?
The 2024 election is three weeks from tomorrow. This cycle has been unusual. The campaign started as a Biden versus Trump rematch of the 2020 campaign, the first such rematch since 1956 (only the seventh time in history and only the second time since 1900). However, President Biden stepped down...
European Market Analysis
Regional News Political tensions between Algeria and France reportedly prompted the former country to exclude its traditionally favored European trading partner from a recent wheat purchase tender. Algeria in its latest tender specifically requested no submissions from France and purchase...
Mercosur Regional Analysis
Wheat After weeks of anticipation, rains finally arrived in the most needed areas of Argentina. At the beginning of the week, the central and northern parts of Córdoba, central and northern Santa Fe, and parts of Entre Ríos received significant rainfall. Toward the end of th...
Going up with a Bang
A futures contract that persistently moves up or down by just a penny or two each day imposes its own burden on the market. While speculators are said to prosper from volatility, and sellers want higher prices and buyers prefer them lower, everyone prefers a story. Apparently, the cotton market...
CFTC COT Report Analysis
Through 8 October, funds continued to exit their formerly massive short positions in corn and soybean futures and now hold a small fraction of that commitment. Funds covered 40 percent of their short position in soybeans and are now only short 18,000 contracts. Similarly, funds bought back half...
WASDE Wheat
WPI offers the following PDF of key supply and demand tables and charts relating to the USDA’s latest WASDE report. This is not an all-inclusive compilation of relevant market factors, only those which we feel are of top priority. WPI will seek to expand the offerings in this report and w...
WASDE Soybeans
WPI offers the following PDF of key supply and demand tables and charts relating to the USDA’s latest WASDE report. This is not an all-inclusive compilation of relevant market factors, only those which we feel are of top priority. WPI will seek to expand the offerings in this report and w...
WASDE Corn
WPI offers the following PDF of key supply and demand tables and charts relating to the USDA’s latest WASDE report. This is not an all-inclusive compilation of relevant market factors, only those which we feel are of top priority. WPI will seek to expand the offerings in this report and w...
Market Commentary: Only Pork Survives the WASDE Intact
The U.S. crop situation for 2024/25 was largely firmed up by today’s USDA October WASDE report. Net, net – there is a lot of grain available. Not enough for any precipitous drop in prices today, but only Lean Hogs managed to end the day higher. Today’s report reinforced...
WASDE Outlook for Livestock: More Beef
Today’s WASDE increased the price outlook for 2024 fed steers after dropping it in September. The September WASDE dropped the fed steer price by $3/cwt to $185.11/cwt from the month prior. Today the price forecast was adjusted up $1/cwt. The forecast for the 2025 annual...
Cocoa Market Update: Prices Rise as Stocks Fall
At the end of July 2024, WPI published an article looking at the drivers of the cocoa market’s massive rally in 2023 and 2024 and that offered an outlook for MY 2024/25. This article offers a brief update on market conditions and developments that have occurred in the two months since our...
Market Commentary: Wheat Rises as Russia Considers Export Ban; Cattle Extend Rally
The CBOT saw wheat emerge as the upside leader for the day with multiple bullish stories offering support, including one from Reuters that indicates Russia may be considering a ban on grain exports. Details are nonexistent, but there is reportedly a meeting soon between the ag ministry and grai...
Oilseed Highlights: Pre-WASDE but Relatively Firm
The Market The soybean market has been sliding heading into tomorrow USDA October WASDE report. The trade has positioned itself in the middle of the September trading range and is still positioned in a somewhat bullish position slightly above the 50-day trading average. The market has been tren...
Livestock Roundup: Red Meat Exports
August trade data was released yesterday. High prices of U.S. beef exports have kept exports down. Compared to August 2023, total exports were 102,682 MT, which was the lowest monthly total since January. For the first eight months of the year, January through August, exports at 856,834 MT were...
Market Commentary: CBOT Trades Weather and WASDE Expectations
Trade at the CBOT on Wednesday was dominated by two factors: global weather and preparations for the October WASDE report, which will come out on Friday. The weather was mostly relevant for wheat as parts of Russia, Ukraine, Australia, and the U.S. Plains battle persistent and increasingly dry...
Policy Potpourri
Good Many Organisms: The Nobel Prize in Chemistry was awarded this week to scientists at Google DeepMind using AI to predict the structure of proteins and inventing new ones. Capitaslizing on the opportunities, Ginkgo Bioworks announced that it would make available to researchers its API that u...
Say Cheese!
Ilena Peng from Bloomberg has written about the expansion of U.S. cheese exports. Former French President Charles de Gaulle once noted that his country has hundreds of different cheeses and the U.S. had hundreds of different religions. But the U.S. has since become a major producer of many diff...
Black Sea Regional Analysis
Russian Grain Markets: 30 September – 4 October 2024 The first week of September proved bullish in European Russia and slightly bearish in the Asian part and Siberia. The weather factor is important but it’s not the key driver. It may become the decisive factor later on depending on...
Market Commentary: Brazil Rains, Crude Oil Selloff Sink Soy Complex; Cattle Extend Rally on Beef Demand
Trade at the CBOT was mostly lower on Tuesday with the soy complex leading the way south as weather models show more promising rains for South America. Soybeans turned sharply lower on the forecasts and scored a bearish technical day on the chart, with additional selling pressure coming from th...
War on Food Companies; Holding Back the Future
War on Food Companies Market skeptics like U.S. Senator Elizabeth Warren (D-Massachusetts) have stepped up their attack on food companies by accusing them of price gouging by “squeezing profits out of consumers” through shrinkflation and avoiding federal taxes. They charge that comp...
USDA Announces Cattle Price Discovery Rule
Today, the Biden Administration issued an Advanced Notice of Public Rulemaking (ANPR) on Price Discovery and Transparency in Markets for Fed Cattle. This is the fifth livestock and poultry market regulation put forth under the Packers and Stockyards Act (P&SA) and under the Biden Executive...
Middle East, Mediterranean and Africa Regional Analysis
Regional Updates MEDITERRANEAN/MIDDLE EAST/NORTH AFRICA/AFRICA – MEA REGION Egypt has a program that it says will reduce wheat imports and cut subsidies on bread. The plan is to blend wheat flour with local corn and sorghum flour. Savings, it is said, could be in the hundreds of millions...
Market Commentary: Harvest and Weather Pressure Continue
Clear weather and rolling combines in the Northern Hemisphere together with prospective showers in South America maintain pressure on commodity futures. However, volume today was relatively low except in soybeans and livestock. While soybeans closed lower, the end of Golden Week and China&rsquo...
Allowing Private Contributions to Conservation Programs to Create Public Assets
USDA’s Natural Resource Conservation Service (NRCS) closed the comment period for the implementing rules for the Sponsoring USDA Sustainability Targets in Agriculture to Incentivize Natural Solutions (SUSTAINS) Act last month. The Act authorizes USDA to accept private contributions to cha...
Mercosur Regional Analysis
Wheat Despite the lack of rain, the Buenos Aires Grain Exchange maintains its outlook for this season’s wheat crop. As we mentioned previously, the rains in August and September were disappointing, and thus far in October they’ve been absent. Additionally, we are seeing rising tempe...
2024/25 Corn Outlook: Strong Demand Shifts Prices Higher
In light of the surprisingly bullish Grain Stocks data, WPI has updated our quarterly corn market outlook to reflect the supply and demand trends reflected in the USDA’s most recent data. Since the September edition of our quarterly outlook, WPI’s forecast has shifted to feature sma...
Market Commentary: Next Week’s Weather Makes or Breaks
It was another day lower for the grain and oilseeds sectors, and another day of weak volume for corn and the soy sector. The causes have not changed: A strengthening dollar Very good harvest weather in the U.S. Potentially better weather in South America late next week If good rains materiali...
U.S. Soybean Crush Margin Outlook
The recent strength in U.S. soyoil and soymeal prices has helped push “board” crush margin (i.e., the margin implied or calculated by CBOT futures contracts) to new highs with the VVX margin hitting $1.62/bushel and the HHH margins topping the $1.45 mark for the first time in over a...
Port Strike Suspended: A Look at Short-Term and Long-Term Issues
East and Gulf Coast port workers are back on the job today after striking on 1 October. Many of the affected ports will add weekend overtime hours to load trucks; several ports will remain closed to trucks today as containers are offloaded to prepared for resumptions of trucking. Importers repo...
WPI Website Restored
Apologies to those that had trouble accessing WPI's website and analysis articles. Service has now been restored. Please advise if you are still having any issues and thank you for your patience during this technology glitch. ...
Market Commentary: Multiple Influences from Macros to Weather
The somewhat bullish influence of Monday’s stocks report has now fully faded. The market today pretty much ignored a solid USDA Export Sales report and instead focused on mostly bearish factors: The EU is postponing enactment of its deforestation policy. Macro jitters around the Middle E...
Oilseed Highlights: EUDR Decision and South American Weather Weigh on Complex
The Market It has been a tough week thus far for soybeans and meal. The EU’s decision to delay its European Union Deforestation Regulation (EUDR) means there will be no break for U.S. exporters in competition from South America and Southeast Asia. The two days of decline have November soy...
Livestock Roundup: Broiler Outlook
Hatcheries set 242.69 million eggs in incubators during the week ending 28 September, up 6.1 percent from a year ago. So far this year, egg sets are up 1.9 percent over last year, and to date through the second half of the year are up 3.5 percent. Last year, eggs set started trendng lower in J...
Coffee Rally Stalls as Weather Shifts, Bear Move Ahead?
Coffee futures have been on a massive rally in 2024 with the ICE “C” contract rising above $2.60/lb last week, breaching that point for just the fifth time since 1970. The catalyst for the rally has been well reported this year, with declining stocks and weather issues in major prod...
Market Commentary: Wheat Jumps Higher on Massive Egypt Imports; Soymeal Falls on EUDR News
Wheat remains the darling of the CBOT with more bullish news pouring into the complex. Today’s rally was sparked by reports that Egypt has booked over 3 MMT of wheat from the Black Sea (presumably Russia) to be exported over the next six months. That move comes as Russian wheat stocks are...
Ludditic Longshoremen; Symptom not Disease
Ludditic Longshoremen Labor strikes are always about money, working conditions and job protection but the latter is skyrocketing to the top. The U.S. East and Gulf Coast port workers’ strike is a prime example. Automation is threatening the number of longshoreman positions needed, and the...
Kenya’s Crop Choices
In yesterday’s WPI Middle East, Mediterranean and Africa Regional analysis report, it was noted that Kenyan farmers are switching from growing maize to growing sweet potatoes. The latter being easier to grow than drought sensitive maize and netting three crops per year. But whether maize...
Black Sea Regional Analysis
Russian Grain Markets: 23–27 September 2024 The Russian grain market was bullish in European Russia but bearish in the Asian part and Siberia because Kazakhstan introduced a temporary ban on imports of Russian wheat. Grain storage facilities are being filled up to the brim with new crop c...
Market Commentary: Grain Stocks Fuel 2-Day Corn Rally; Wheat Rises with Russian Prices
CBOT grains and oilseeds seem to be playing “follow the leader” and have recently switched roles. Previously, soybeans were rallying and pulling grain futures grudgingly higher, but that has completely flipped following Monday’s Grain Stocks report. Now, corn and wheat are ris...
Trade Policy Spin; Interstate Trade Barriers
Trade Policy Spin It is an election year, and the Biden Administration is claiming to have opened up $26.7 billion in overseas market access for American farmers. But that carries the same weight with farmers as grocery buyers hearing that food inflation has declined. They are still paying more...
East and Gulf Port Workers on Strike
A port worker strike in the U.S. East Coast and Gulf Ports started today affecting container shipments, while a strike in Vancouver, Canada affecting grain shipments came to an end on Saturday with the final ratification vote to come this Friday, 4 October. As WPI’s Matt Herrington...
Middle East, Mediterranean and Africa Regional Analysis
Regional Updates MEDITERRANEAN/MIDDLE EAST/NORTH AFRICA/AFRICA – MEA REGION Pakistan’s wheat imports in 2024/25 could drop to almost nothing as a result of the very good harvest in 2024 – up by 3.2 MMT. Wheat production was well above the average at a record level of 31,400 MM...
Market Commentary: Grain Stocks Bullish Corn but Neutral Soy, Wheat; Port Strike Looms
Monday’s CBOT trade was essentially dedicated to the Grain Stocks report with pre-report trading seeing muted action and steady volumes while post-report trade saw a meaningful rally in corn and a pullback in soybeans. The report issued a surprisingly small corn stocks figure, which spurr...
Hurricane Helene Impacts in the Southeast
After making landfall along the Gulf Coast of Florida, Hurricane Helene struck northeast Georgia and western North Carolina. All commodities in the region have been affected, including pecan orchards and timber land, but also corn, soybeans, cotton and poultry. Given the location, hog pro...
Green for You, Grey for Me; Slaying National Champions
Green for You, Grey for Me Some say the EU has been vague about whether it will seek a delay in the December 30 implementation deadline for implementing the EU Deforestation Regulation (EUDR). Brussels told WTO members last week that delay would require a legislative change, which is not imposs...
Russia’s Grain Shortfall
Today’s USDA quarterly Grain Stocks report provided the market with a bullish input but there may be another shoe to drop. Russia’s stocks to use ratio for corn and wheat have been dropping for four straight years. Over that timeframe, it is down 64 percent for corn and 48 percent f...
Mercosur Regional Analysis
Argentina’s Weather The weather remains a recurring issue in Argentina. The lack of rainfall across much of the country's agricultural region is starting to impact both the wheat crop, currently in its yield-defining stages, and the sowing of summer crops. Precipitation anomaly maps...
European Market Analysis
Regional News Four regions in Russia’s Siberia have declared states of emergency due to heavy rains and flooding. Milling Wheat Wheat markets were higher last week with U.S. futures rising about $5/MT while the Paris market added €1.25/MT for the week. Markets remain conc...
Grain Stocks Report Charts
The attached PDF offers graphical depiction and analysis of the latest USDA Grain Stocks data for key commodities. The data is, of course, taken from the quarterly Grain Stocks report. WPI recently completed an expansion of the analysis and welcomes any feedback/suggestions. ...
CFTC COT Report Analysis
Funds activity in the ag futures markets was more subtle than expected for the second straight week. Specifically, fund short-covering in the corn and wheat markets lagged expectations by a wide margin. In corn futures, funds bought back 3,700 contracts (2.6 percent) of their prior short, which...
Market Commentary: Pre-Report Plus Brazil Lightens Risk
Volume was light except in soymeal, Feeders and lean hogs. USDA’s final quarterly stocks report for MY 2023/24 arrives Monday and it has surprised to the bullish side for the past four out of five years. So the goal was to get out of short positions. On the week, soymeal exploded on...
Policy Quick Hits
Government Funding President Biden yesterday signed a continuing resolution passed by Congress to fund the government at current levels until 20 December. There were no riders – such as an extension of the farm bill – included. This sets up another deadline before the Christmas holi...
Cow-Calf Margins Down from July but Still Imply Herd Rebuilding
Since WPI’s July update on cow-calf margins, expected 2024 returns for producers have shifted lower but remain well above year-ago values and near record highs. WPI’s models indicate that revenue for the “average” Southern Plains (i.e., Kansas) cow-calf operation will hi...
Nudge versus Cudgel; New Japanese PM; Pesticide Restrictions
Nudge versus Cudgel The Biden Administration has achieved some market openings in various countries, the most recent being obtaining agreement from Chile to accept American cheese products marked with European origin names like gouda, cheddar, and provolone. Chief Agricultural Negotiator Doug M...
Market Commentary: Crude Oil Selloff Sinks Soyoil, Soybeans; Corn, Wheat Lower Ahead of Stocks Report
A surprise selloff in crude oil put heavy selling pressure on the CBOT soy complex on Thursday, with soyoil and soybeans scoring bearish reversals for the day. The weakness in the soy complex sent corn and wheat into the red as well, with traders unwilling to take more long risks heading into t...
Oilseed Highlights: Weakness Today But Still Plenty of Support
The Market The soy complex has had a bullish week thus far, moving higher on a weather premium added for Brazil, and news that China, the largest importer of soybeans, will significantly boost economic stimulus. Short-covering had been rampant until today’s selloff. News that Saudi Arabia...
Livestock Roundup: Hogs and Pigs Report Mostly Neutral
Today, USDA released its quarterly Hogs and Pigs report for the June through August quarter. The total inventory of hogs and pigs on 1 Spetmeber was 76.48 milllion head, which was up from 76.133 million head in 2023. Typically, inventories grow from 1 June and peak for the ye...
Market Commentary: Soyoil and Beans Lead Sector Higher
The CBOT was higher once again with soybeans and the oilseed complex leading the way. Drought in Brazil and the surging soyoil prices have supported the complex and driven a widespread wave of short-covering by funds. Corn and wheat futures followed the oilseed markets higher at midweek but fai...
Industry Consolidation
U.S. antitrust law is complicated, but current efforts to block a merger between grocery retailers Albertsons and Kroger may not fit the bill. Current triggers under the law include: Market share of 70 percent or more, or less than 50 percent if barriers limit competition. Barriers to entry pr...
Black Sea Regional Analysis
Russian Grain Markets: 16–20 September 2024 Russian grain markets remained stagnant as export demand is weak and domestic demand is even weaker. Moreover, appreciation of grains earlier in the month reached its peak at this stage of the game and buyers are very careful right now. Sellers...
Market Commentary: Soybeans, Soyoil Extend Rallies; Wheat, Corn Fall as Short-Covering Fades
The CBOT saw diverging trading patterns on Tuesday with soybeans and soyoil continuing their rallies and extending gains to new highs. China is rumored to be purchasing up to 1.2 MMT (44 Mbu or 20 cargoes) of U.S. soybeans for October-November delivery, which put a bid under the market. Too, th...
Hogs and Pigs Report Preview
On Thursday, USDA will release its quarterly Hogs and Pigs report for the June through August quarter showing the inventory as of 1 September. Pre-report expectations peg the total inventory at 100.5 percent of last year. That would imply 75.7 million head, the largest inventory for the quarter...
Tariff Spiral and WTO Failure; Nuclear Power and GMO’s
Tariff Spiral and WTO Failure Republican presidential nominee Donald Trump now says he will impose 200 percent tariffs on farm machinery from John Deere should the company move its manufacturing to Mexico. He said he would also provide incentives for foreign companies to move their operations t...
Energy and Agriculture
Global agriculture produces energy, with 23 percent of ethanol produced from sugarcane, and another 7 percent produced from the molasses byproduct of processing sugarcane or sugarbeets. Increased production of ethanol has caused global sugar carryover to decline. Agriculture is also a major con...
Middle East, Mediterranean and Africa Regional Analysis
Regional Updates MEDITERRANEAN/MIDDLE EAST/NORTH AFRICA/AFRICA – MEA REGION Bangladesh reports that it will be importing 400,000 MT of wheat immediately with the normal buying approval being shortened from 42 days to 15 days. The change is being made in order to maintain food security. Th...
Market Commentary: CBOT Rallies on Weather, Short Covering; Monetary Policy Turns Bullish Commodities
The CBOT jumped sharply higher to start the new week with wheat leading the move with overnight strength. Fund short covering drove much of the day’s gains, but dryness in Brazil and the Black Sea, along with some rain-induced U.S. harvest delays, offered some fundamental motivation...
Hypocritical on Process Standards; Buy America Bust; Politics of the Port Strike
Hypocritical on Process Standards EU Commission President Ursula von der Leyen will make a decision this week on implementation of the EU Deforestation Regulation. It is set to take effect at the start of 2025 but both internal and external forces want the measure delayed and modified. That inc...
Pending Port Strikes: U.S. East and Gulf Coasts and Vancouver Canada
With a pending 1 October strike deadline on the U.S. East and Gulf Coasts by the International Longshoreman’s Association (ILA), the U.S. Department of Labor has reached out to the U.S. Maritime Alliance (USMX), a group that represents employers of the East and Gulf Coasts longshore indus...
Running Out of Protein
Europe ran out of energy when the Russian attack on Ukraine forced it to reduce imports from Russia. Europe lacks the ability to defend itself despite Russia’s threat on its eastern border. Now Europe is reducing its consumption of meat but failing to invest in meat alternatives that coul...
European Market Analysis
Regional News WPI sources in Brussels say it’s increasingly likely that the EU Deforestation Regulations will be delayed until the region can develop better implementing systems. Recall that EUDR – which would force massive reporting and traceability requirements on seven comm...
Mercosur Regional Analysis
Argentina Economic/Policy Update Argentine President Javier Milei, in a public speech this week, presented the 2025 budget that will be sent to Congress for approval. Farmers had high expectations for potential announcements that might improve their business or provide visibility concerni...
CFTC COT Report Analysis
Funds activity in the ag futures markets was more subdued last week than expected. Funds were slight net buyers in soybeans, soymeal, corn, and across the wheat complex, but the percentage shifts in their positions and overall buying volumes underperformed expectations. In the soy complex...