Market Commentary: Some Reversals, Some Not
Corn, soybeans and soyoil all closed lower after trading up the previous three sessions. July soymeal made it a fourth trading session higher, and wheat remains on a tear with a fifth trading session closing higher. The mood around wheat sees supply concerns developing in North America and in t...
Forecast Cow-Calf Profits Near Record, Robust Heifer Retention Expected
Cow-calf producer margins are discussed less frequently in these pages than their downstream counterparts of feedlot and beef packer margins, but this doesn’t mean they are less important to understanding the beef industry’s current state and outlook. Additionally, discussion of thi...
Reigniting a Transatlantic Deal; Indian Powerhouse; “Barons” is Bombastic
Reigniting a Transatlantic Deal Former Italian prime minister Enrico Letta is something of a policy rock star after authoring a report on the future strategy for the EU. Most of the 146-page report focuses on strengthening the EU’s internal Single Market but, buried at the end of th...
Black Sea Regional Analysis
Russian Grain Markets: 15–19 April 2024 International sanctions and reverse measures Russia adopted towards “unfriendly” countries may leave Russia without proper genetics for this spring’s planting campaign. While small grains are available due to long term domestic see...
Market Commentary: Wheat Extends Rally; Funds Cover Shorts Amid Widespread Futures Strength
The spring 2024 wheat rally continues as weather threats linger for the U.S., Europe, and the Black Sea. Weather forecasts that offer a challenging outlook for the 2024/25 Northern Hemisphere crop are forcing funds to keep exiting short positions, with the resulting positive technical developme...
Hecho en Mexico; Radical for Small; Impeach Tai?
Hecho en Mexico While outgoing Mexican president and populist AMLO tries to shutdown American farmers, the U.S. government just keeps giving to Mexico. The de minimis duty is about to go away. The personal free import allowance is complex. Most American citizens reentering the country think of...
Squeeze on White Corn
South Africa’s Crop Estimates Committee warns that instead of a previously expected 13.8 percent increase in maize production in 2024/25, output could fall to a five year low on account of El Nino. The shortfall is particularly acute for white corn, with the price rising 30 percent thus f...
E15’s Rube Goldberg Regulations
Last Friday, 19 April, the EPA issued an emergency waiver for E15 to be sold through the summer driving season. The topline takeaway of that action is positive for the ethanol sector, but the practicality of implementing the new rule is more complex. Indeed, the structure of the Cle...
Middle East, Mediterranean and Africa Regional Analysis
Regional Updates MEDITERRANEAN/MIDDLE EAST/NORTH AFRICA/AFRICA – MEA REGION Iran, Bangladesh, and the UAE were major destinations for Indian soymeal exports in March 2024, representing 78 percent of exports – Bangladesh 33,000 MT, Iran 88,000 MT, and UAE 18,000 MT. Iran imported 429...
Market Commentary: Global Wheat, Oilseed Futures Rally on Weather Threats
Friday’s strength in CBOT and broader global ag commodity futures was simply a foreshadowing of the rallies that would develop on Monday. Heading into the weekend, markets were jittery on perceived weather risks, many of which turned out to be prescient. Over the weekend, parts of the U.S...
WPI Crop Progress and Conditions App (Updated 22 April)
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...
Trading Waste; Ottawa versus Manila; Politician’s Lag
Trading Waste Rich Westerners consumed so much plastic that even though landfills take much of it, their export of plastic waste now overwhelms Asia. Then Western policymakers gave yellow grease (used cooking oil) a very low carbon score for use as energy since it is a form of recycling. With h...
Water, Energy, and Competition
Agriculture is both water and energy. As a prime input to food production, agriculture has long been characterized as the exporting of water. Now it is increasingly the exporting of energy. U.S. ethanol exports rose 16 percent over the past two years and are up 30 percent for the first two mont...
European Market Analysis
Regional News Early-morning frosts were reported across Poland down to France as crops are reaching growth stages that are sensitive to cold. It’s too early to say whether the cold snap will dent yields, but the 2024 crop continues to face weather challenges. Tunisia pur...
Mercosur Regional Analysis
Wheat Wheat from the 2024/25 campaign remains a topic of discussion in Argentina, with conflicting views regarding the area to be sown. The reality of the situation is that wheat production margins have been improving in recent weeks due to the improvements in futures prices, but also due...
Market Commentary: CBOT Gains to Close Week; Wheat Firms on Bullish News
The CBOT was mostly higher to end a mostly bearish week with wheat leading the way on several mildly bullish developments. Wheat futures saw price-supportive development in the IGC’s lower 2024/25 global ending stocks forecast, dryness in the U.S. Southern Plains, and smaller Russian 2024...
CFTC COT Report Analysis
Based on futures’ price action late last week and early this week, one would be expecting funds to have been net sellers in the major ag commodities, and that’s exactly what happened. Funds expanded their short soybean position by some 30,000 contracts, making it a new five-year low...
Cattle on Feed Report: Placements and Marketings Dropped Sharply
USDA released the monthly Cattle on Feed report today. Total inventory, placements and marketings all came in lower than the pre-report estimates, though total inventory was at the same volume or higher than last year for the seventh consecutive month. Placements came in well below the average...
Oilseed Highlights: Still Softly Descending
The Market Soybeans sharply rebounded on Friday after hitting a one month low the day before, likely on short covering. For the week, May soybeans lost 16.25 cents (-2 percent) and November soybeans gave up 15.25 cents. The latter new crop contract still carries an 11 cent premium over the soon...
FOB Prices and Freight Rate App (Updated 19 April)
Ocean Freight Comments - 19 April 2024 By Matt Herrington Spot dry-bulk freight markets remain weak amid dull April demand but rates are improving for May and June with improved interest in booking cargoes. Chinese demand for iron ore and coal has improved and bolstered capesize rates while gra...
Interactive Ocean Freight Rates (Updated 19 April)
Ocean Freight Comments - 19 April 2024 By Matt Herrington Spot dry-bulk freight markets remain weak amid dull April demand but rates are improving for May and June with improved interest in booking cargoes. Chinese demand for iron ore and coal has improved and bolstered capesize rates while gra...
Market Commentary: Looking for Market Movers
The bearishness continues as South America crops loom and Northern Hemisphere weather is stable. The impending flood of Argentine soymeal and soyoil onto the market sent the May soyoil contract to a new low. There was nothing in today’s weekly USDA Export Sales report to alter the...
Transatlantic GI’ing Consumers; Political Expediency, Oh My
Transatlantic GI’ing Consumers Politicians on both sides of the Atlantic protest big business and their sacrilegious capitalism. Yet sometimes it is government screwing the consumer to boost private profits. Parmigiano Reggiano was a prized and premium priced cheese before obtaining the E...
Livestock Roundup: Cattle on Feed Preview
USDA will release its Cattle on Feed report tomorrow; the consensus pre-report analysts’ estimate is for the inventory of cattle on feed as of 1 April to be 102 percent of last year; this would be the seventh consecutive month that inventories were equal to or larger than the previous yea...
Market Commentary: Grains Fall while Oilseeds Gain; Oil Falls on U.S. Stocks, Chinese Economy
The CBOT was mixed on Wednesday with wheat futures dropping amid fund selling due to a stronger U.S. dollar and easing Russian FOB offers while corn drifted lower in lackluster, low-volume trade. While the grains were on the defensive, the soy complex found some support from technically related...
Biden-Trump on Trade Policy
A Washington International Trade Association discussion on trade policy with former officials from both the Trump and Biden administrations reinforced the bipartisan agreement on some trade policies. A day after House GOP representatives slammed USTR Katherine Tai for the Biden Administration&r...
Wheat Uptake with No Clear Answer
USDA reports that per capita flour consumption in 2023 fell to the lowest level in 37 years. Flour production and exports were lower, but so were flour imports. The question is why? It has been noted that consumers in developing countries with rising incomes tend to switch from rice consumption...
Black Sea Regional Analysis
Russian Grain Markets: 8–12 April 2024 During the first week of April, the Russian domestic grain market remained quite volatile but predominantly stable and bearish. The exception was milling wheat going for export which triggered price improvements in the ports against a weaker RUB and...
Market Commentary: Corn, Soybeans Fall on Planting Progress, Weather; NOPA Report Sinks Soyoil
The CBOT was mostly lower on Tuesday with broadly favorable weather in the U.S. and South America allowing timely planting and harvesting, respectively, of summer crops. Monday’s Crop Progress report from USDA indicated that U.S. farmers are making solid gains seeding the 2024 crops with...
Supply Chain Diversity; Clean Hands?; Bipolar Politics
Supply Chain Diversity EU policy experts have assembled a tome on the “State of Food Security in the EU.” The biannual report focuses on how to ensure food security in times of crisis. The authors highlight the growing concerns about extreme adverse weather events in the EU. They lo...
Fed Cattle Near Term Supply and Demand
Fed cattle prices remain at record levels, but the market has been bearish with dropping futures and a weak cash market; prices dropped last week about $2 live and $4 dressed. In the first four months of last year, cattle prices climbed steadily and hit their highest level in April, dropp...
An Era up in Smoke
British Prime Minister Rishi Sunak has proposed that anyone turning 15 years of age or younger in 2024 will be banned forever from purchasing cigarettes. Eash year, the age restriction will be raised by one year. The bill also makes vapes less appealing. The goal is to start the first generatio...
Middle East, Mediterranean and Africa Regional Analysis
MEDITERRANEAN/MIDDLE EAST/NORTH AFRICA/AFRICA – MEA REGION Regional Updates Due to the Ramadan Eid El Fitr holidays ending, there is no grain news or information from the MENA region this week. SOUTHERN/EASTERN/WESTERN AFRICA Ghana’s government faces serious criticism f...
Market Commentary: CBOT Falls on Stronger Dollar, Technical Trade; NOPA Crush Sets Record
The CBOT was mostly lower to start the week with a rising U.S. dollar and favorable weather for the U.S. and South America pressuring values. Some jitters over the weekend developments in the Middle East also kept markets on the defensive, though crude oil prices slipped lower despite the incre...
Farm Bill and Prop 12 Federal Preemption
House Agriculture Committee Chairman Glenn Thompson (R-Pennsylvania) has stated that he will move a farm bill draft out of committee in May; the Ranking Minority Member, David Scott (D-Georgia) has indicated that he’ll work with Thompson to have a bipartisan timeline to work on the legisl...
Sparks to Fly; Selective Competitiveness; Fixing India
Sparks to Fly U.S. Trade Representative Katherine Tai appears before House and Senate committees this week to testify on the Biden Administration’s 2024 trade policy. Over the past three years, the Office of U.S. Trade Representative has slow walked trade policy changes, focusing on labor...
Market Commentary: Some Reversals, Some Not
Corn, soybeans and soyoil all closed lower after trading up the previous three sessions. July soymeal made it a fourth trading session higher, and wheat remains on a tear with a fifth trading session closing higher. The mood around wheat sees supply concerns developing in North America and in t...
Forecast Cow-Calf Profits Near Record, Robust Heifer Retention Expected
Cow-calf producer margins are discussed less frequently in these pages than their downstream counterparts of feedlot and beef packer margins, but this doesn’t mean they are less important to understanding the beef industry’s current state and outlook. Additionally, discussion of thi...
Reigniting a Transatlantic Deal; Indian Powerhouse; “Barons” is Bombastic
Reigniting a Transatlantic Deal Former Italian prime minister Enrico Letta is something of a policy rock star after authoring a report on the future strategy for the EU. Most of the 146-page report focuses on strengthening the EU’s internal Single Market but, buried at the end of th...
Black Sea Regional Analysis
Russian Grain Markets: 15–19 April 2024 International sanctions and reverse measures Russia adopted towards “unfriendly” countries may leave Russia without proper genetics for this spring’s planting campaign. While small grains are available due to long term domestic see...
Market Commentary: Wheat Extends Rally; Funds Cover Shorts Amid Widespread Futures Strength
The spring 2024 wheat rally continues as weather threats linger for the U.S., Europe, and the Black Sea. Weather forecasts that offer a challenging outlook for the 2024/25 Northern Hemisphere crop are forcing funds to keep exiting short positions, with the resulting positive technical developme...
Hecho en Mexico; Radical for Small; Impeach Tai?
Hecho en Mexico While outgoing Mexican president and populist AMLO tries to shutdown American farmers, the U.S. government just keeps giving to Mexico. The de minimis duty is about to go away. The personal free import allowance is complex. Most American citizens reentering the country think of...
Squeeze on White Corn
South Africa’s Crop Estimates Committee warns that instead of a previously expected 13.8 percent increase in maize production in 2024/25, output could fall to a five year low on account of El Nino. The shortfall is particularly acute for white corn, with the price rising 30 percent thus f...
E15’s Rube Goldberg Regulations
Last Friday, 19 April, the EPA issued an emergency waiver for E15 to be sold through the summer driving season. The topline takeaway of that action is positive for the ethanol sector, but the practicality of implementing the new rule is more complex. Indeed, the structure of the Cle...
Middle East, Mediterranean and Africa Regional Analysis
Regional Updates MEDITERRANEAN/MIDDLE EAST/NORTH AFRICA/AFRICA – MEA REGION Iran, Bangladesh, and the UAE were major destinations for Indian soymeal exports in March 2024, representing 78 percent of exports – Bangladesh 33,000 MT, Iran 88,000 MT, and UAE 18,000 MT. Iran imported 429...
Market Commentary: Global Wheat, Oilseed Futures Rally on Weather Threats
Friday’s strength in CBOT and broader global ag commodity futures was simply a foreshadowing of the rallies that would develop on Monday. Heading into the weekend, markets were jittery on perceived weather risks, many of which turned out to be prescient. Over the weekend, parts of the U.S...
WPI Crop Progress and Conditions App (Updated 22 April)
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...
Trading Waste; Ottawa versus Manila; Politician’s Lag
Trading Waste Rich Westerners consumed so much plastic that even though landfills take much of it, their export of plastic waste now overwhelms Asia. Then Western policymakers gave yellow grease (used cooking oil) a very low carbon score for use as energy since it is a form of recycling. With h...
Water, Energy, and Competition
Agriculture is both water and energy. As a prime input to food production, agriculture has long been characterized as the exporting of water. Now it is increasingly the exporting of energy. U.S. ethanol exports rose 16 percent over the past two years and are up 30 percent for the first two mont...
European Market Analysis
Regional News Early-morning frosts were reported across Poland down to France as crops are reaching growth stages that are sensitive to cold. It’s too early to say whether the cold snap will dent yields, but the 2024 crop continues to face weather challenges. Tunisia pur...
Mercosur Regional Analysis
Wheat Wheat from the 2024/25 campaign remains a topic of discussion in Argentina, with conflicting views regarding the area to be sown. The reality of the situation is that wheat production margins have been improving in recent weeks due to the improvements in futures prices, but also due...
Market Commentary: CBOT Gains to Close Week; Wheat Firms on Bullish News
The CBOT was mostly higher to end a mostly bearish week with wheat leading the way on several mildly bullish developments. Wheat futures saw price-supportive development in the IGC’s lower 2024/25 global ending stocks forecast, dryness in the U.S. Southern Plains, and smaller Russian 2024...
CFTC COT Report Analysis
Based on futures’ price action late last week and early this week, one would be expecting funds to have been net sellers in the major ag commodities, and that’s exactly what happened. Funds expanded their short soybean position by some 30,000 contracts, making it a new five-year low...
Cattle on Feed Report: Placements and Marketings Dropped Sharply
USDA released the monthly Cattle on Feed report today. Total inventory, placements and marketings all came in lower than the pre-report estimates, though total inventory was at the same volume or higher than last year for the seventh consecutive month. Placements came in well below the average...
Oilseed Highlights: Still Softly Descending
The Market Soybeans sharply rebounded on Friday after hitting a one month low the day before, likely on short covering. For the week, May soybeans lost 16.25 cents (-2 percent) and November soybeans gave up 15.25 cents. The latter new crop contract still carries an 11 cent premium over the soon...
FOB Prices and Freight Rate App (Updated 19 April)
Ocean Freight Comments - 19 April 2024 By Matt Herrington Spot dry-bulk freight markets remain weak amid dull April demand but rates are improving for May and June with improved interest in booking cargoes. Chinese demand for iron ore and coal has improved and bolstered capesize rates while gra...
Interactive Ocean Freight Rates (Updated 19 April)
Ocean Freight Comments - 19 April 2024 By Matt Herrington Spot dry-bulk freight markets remain weak amid dull April demand but rates are improving for May and June with improved interest in booking cargoes. Chinese demand for iron ore and coal has improved and bolstered capesize rates while gra...
Market Commentary: Looking for Market Movers
The bearishness continues as South America crops loom and Northern Hemisphere weather is stable. The impending flood of Argentine soymeal and soyoil onto the market sent the May soyoil contract to a new low. There was nothing in today’s weekly USDA Export Sales report to alter the...
Transatlantic GI’ing Consumers; Political Expediency, Oh My
Transatlantic GI’ing Consumers Politicians on both sides of the Atlantic protest big business and their sacrilegious capitalism. Yet sometimes it is government screwing the consumer to boost private profits. Parmigiano Reggiano was a prized and premium priced cheese before obtaining the E...
Livestock Roundup: Cattle on Feed Preview
USDA will release its Cattle on Feed report tomorrow; the consensus pre-report analysts’ estimate is for the inventory of cattle on feed as of 1 April to be 102 percent of last year; this would be the seventh consecutive month that inventories were equal to or larger than the previous yea...
Market Commentary: Grains Fall while Oilseeds Gain; Oil Falls on U.S. Stocks, Chinese Economy
The CBOT was mixed on Wednesday with wheat futures dropping amid fund selling due to a stronger U.S. dollar and easing Russian FOB offers while corn drifted lower in lackluster, low-volume trade. While the grains were on the defensive, the soy complex found some support from technically related...
Biden-Trump on Trade Policy
A Washington International Trade Association discussion on trade policy with former officials from both the Trump and Biden administrations reinforced the bipartisan agreement on some trade policies. A day after House GOP representatives slammed USTR Katherine Tai for the Biden Administration&r...
Wheat Uptake with No Clear Answer
USDA reports that per capita flour consumption in 2023 fell to the lowest level in 37 years. Flour production and exports were lower, but so were flour imports. The question is why? It has been noted that consumers in developing countries with rising incomes tend to switch from rice consumption...
Black Sea Regional Analysis
Russian Grain Markets: 8–12 April 2024 During the first week of April, the Russian domestic grain market remained quite volatile but predominantly stable and bearish. The exception was milling wheat going for export which triggered price improvements in the ports against a weaker RUB and...
Market Commentary: Corn, Soybeans Fall on Planting Progress, Weather; NOPA Report Sinks Soyoil
The CBOT was mostly lower on Tuesday with broadly favorable weather in the U.S. and South America allowing timely planting and harvesting, respectively, of summer crops. Monday’s Crop Progress report from USDA indicated that U.S. farmers are making solid gains seeding the 2024 crops with...
Supply Chain Diversity; Clean Hands?; Bipolar Politics
Supply Chain Diversity EU policy experts have assembled a tome on the “State of Food Security in the EU.” The biannual report focuses on how to ensure food security in times of crisis. The authors highlight the growing concerns about extreme adverse weather events in the EU. They lo...
Fed Cattle Near Term Supply and Demand
Fed cattle prices remain at record levels, but the market has been bearish with dropping futures and a weak cash market; prices dropped last week about $2 live and $4 dressed. In the first four months of last year, cattle prices climbed steadily and hit their highest level in April, dropp...
An Era up in Smoke
British Prime Minister Rishi Sunak has proposed that anyone turning 15 years of age or younger in 2024 will be banned forever from purchasing cigarettes. Eash year, the age restriction will be raised by one year. The bill also makes vapes less appealing. The goal is to start the first generatio...
Middle East, Mediterranean and Africa Regional Analysis
MEDITERRANEAN/MIDDLE EAST/NORTH AFRICA/AFRICA – MEA REGION Regional Updates Due to the Ramadan Eid El Fitr holidays ending, there is no grain news or information from the MENA region this week. SOUTHERN/EASTERN/WESTERN AFRICA Ghana’s government faces serious criticism f...
Market Commentary: CBOT Falls on Stronger Dollar, Technical Trade; NOPA Crush Sets Record
The CBOT was mostly lower to start the week with a rising U.S. dollar and favorable weather for the U.S. and South America pressuring values. Some jitters over the weekend developments in the Middle East also kept markets on the defensive, though crude oil prices slipped lower despite the incre...
Farm Bill and Prop 12 Federal Preemption
House Agriculture Committee Chairman Glenn Thompson (R-Pennsylvania) has stated that he will move a farm bill draft out of committee in May; the Ranking Minority Member, David Scott (D-Georgia) has indicated that he’ll work with Thompson to have a bipartisan timeline to work on the legisl...
Sparks to Fly; Selective Competitiveness; Fixing India
Sparks to Fly U.S. Trade Representative Katherine Tai appears before House and Senate committees this week to testify on the Biden Administration’s 2024 trade policy. Over the past three years, the Office of U.S. Trade Representative has slow walked trade policy changes, focusing on labor...