12/05/19 8:00am  

Trade awaits export sales report this a.m. and any updates on weather in South America as Argentina is noting a start to some concerns about drought meanwhile Brazil moisture is sufficient for growing crops.  Soy complex still in hopes of a U.S./China deal soon. 

Market is awaiting next week's USDA Supply and Demand report which were submitted to newswires yesterday. The report will be out Tuesday December 10th at 11:00 AM CST.  The norm for the December report is no surprises.  Traders average estimate for corn carryout at 1.919 billion bushels, soybeans 0.476 billion bushels and the wheat at 1.010 billion bushels.

Ethanol plants are responding to strengthened margins. Production last week averaged 1.060 million barrels per day. That was 0.8% under last year.  We now have three weeks in a row that are operating under a different production regime. The past three weeks have run from -0.9% to +1.0%.  It is estimated we ground 104.05 million bushels last week. 

Funds credited with selling 7K corn yesterday and estimated net short 121K contracts. Bought 6K beans and net short 56K.

Weekly export sales were released this morning at 7:30 a.m. CST. Traders anticipate seeing wheat sales of 300,000 to 700,000 MT’s, corn 500,000 to 900,000, soybeans 700,000 to 1,300,000, soymeal 100,000 to 300,000, and soyoil 5,000 to 25,000.  Export sales for both corn and soybeans disappointing reaffirming this years South American large crop overshadowing U.S. price competitiveness in the global markets and high U.S. dollar. 

COMMODITY                                              ACTUAL SALES                                            LAST YEAR

 CORN                                                       546,100 MT’S                                             1,177,500 MT’S

 SOYBEANS                                                683,800 MT’S                                               890,800 MT’S

Better soybean basis triggering some “operational” and “logistical” inventory selling from commercials. 42¢ carry to July keeping sales largely limited to those factors. Crush margins certainly not an impediment to firmer basis values. Flat price could be? Market due for a rally after a 6 week 92¢ break?

Chart below shows the opportunity for producers to sell corn today and re own on the board with our Extended Price Contract (EPC). As you can see by buying the July futures back it gives you time to take advantage of futures moves from now until end of next June, plus generates cash today if you want and gives you the ability to top corn bins, with no storage cost.