November 20, 2023 Grain Commentary
Market Re-Cap 11/20/23
Overnight, Argentina elected libertarian Javier Milei, who is pledging “shock therapy” to fix their economy. Reuters News headlined the victory article with “an opportunity for ‘radical change’ for the grain sectors.” Milei plans to cut taxes and reduce the size of the government. However, the change in administration did not fret the markets. Corn and beans closed higher for the day, while wheat traded lower. The energy markets saw a 2% gain in crude and heating oil while natural gas shaved off 2.75%.
Corn– Corn hoovered the open all day, trading pennies on either side. The December corn contract closed 2.75c higher at $4.69. March picked up 2.25 cents to $4.87, and May picked up 1.75 cents at $4.97. The spread has widening slightly. Corn started the morning with a small corn sale to Mexico for the current marketing year. Reports of China grain imports showed a 2% decline in corn purchases and a 55% decline in sorghum purchases.
Beans– 26c gains graced the first three bean contracts today. January closed at $13.67, March at $13.83, and May at $13.95. Double-digit gains were present on all contracts out to 2026. The crush market made for good support. After a three session sell off in meal, it turned around to inch back towards last week’s high. Industry estimates that only 69% of Brazil’s soy acres are planted, compared to 80% last year. Some analysts have projected that Brazil will shift bean acres to cotton due to dry weather.
Wheat– HRW and SRW wheat saw 6 cent losses in the December contract. Conflicts on the Black Sea have led to softer markets. A 10 day blockade by Polish truckers has left 3000 Ukraine trucks stranded. The Ukraine traffic through Poland has doubled since the war started, which is fueling the blockade. Ukraine wheat is projected at 4 million hectares planted in 2024. This is lower than 2023 at 4.5mlm hectors.
The DeLong Co., Inc.