Wheat near or at contract lows... Corn futures are around a penny lower after a quiet overnight session in which traders favored the downside. Soybean futures are mixed with an upside bias. Wheat futures are fractionally to 2 cents lower, with winter wheat contracts again challenging or hitting new contract lows. The U.S. dollar index is down slightly, while crude oil futures are posting solid losses.
Ongoing dryness in Argentina heightens attention on late-week rains... Dryness is expected to expand in many areas of Argentina this week amid warmer temperatures and limited rainfall, increasing the importance of rain chances at week's end and into the weekend. Weather watchers are calling for rain to move into Thursday, with much of the nation expected to benefit from precip, though accumulation is expected to be light in eastern Buenos Aries, Entre Rios and neighboring areas. Dry weather is expected to return the week following. Key growing areas of Brazil received rain over the weekend, and conditions are expected to remain favorable over the next two weeks. Of note, southern Brazil that was overly wet early in the season is now starting to dry out. But rain is expected to fall in the region in about a week.
The week ahead... The full Senate is slated to vote on its tax plan after a "vote-a-rama," a series of votes on many amendments offered by Democrats and Republicans. If it passes, differences with the House bill will need to be reconciled before any final legislation can be sent to the president. If Senate debate slips into next week, it would up the odds of the issue going into early 2018. President Donald Trump plans to meet Tuesday with congressional leaders on keeping the government open after current funding expires Dec. 8. A short-term stopgap spending bill is widely expected. The biofuels sector is looking for EPA's release of the biofuel usage mandates for 2018 (2019 for biodiesel) via the Renewable Fuel Standard program. These are due by Nov. 30. On the economic front, outgoing Fed Chairwoman Janet Yellen testifies before the Joint Economic Committee and the confirmation for her successor, Jerome "Jay" Powell, begins.
Senate tax vote expected to be a squeaker... The Senate tax reform vote this week is expected to be a close one, with passage hinging on whether changes to the Senate plan can woo enough Republican votes on an assumption no Democratic member will vote for the proposal. If there are enough GOP votes for the plan, some Democratic senators would then reportedly vote for the measure. With a meager 52-48 majority in the Senate, Republican leaders can afford to lose no more than two GOP votes on the tax bill, with Vice President Mike Pence prepared to cast a tie-breaking vote. Get more details on the measure and the process.
Conyers stepping down as ranking Democrat on Judiciary panel... Representative John Conyers (D-Mich.) is stepping down from his post as the top Democrat on the Judiciary Committee amid accusations of sexual harassment against aides and misuse of office resources, the lawmaker announced Sunday, even as he denies the allegations. "After careful consideration and in light of the attention drawn by recent allegations made against me, I have notified the Democratic Leader of my request to step aside as Ranking Member of the House Judiciary Committee during the investigation of these matters," Conyers said.
China cut import tariffs on a broad range of consumer goods in a bid to boost domestic consumption... The move on 187 goods will mean lower prices for foreign goods such as food, pharmaceuticals and clothing, amid complaints from other nations about trade barriers. Taxes were slashed to an average rate of 7.7% from 17.3%.
Chinese cotton auctions to begin in March... China will kick off its daily auctions of 30,000 MT of cotton on March 12, 2018, the National Development and Reform Commission announced today. These daily sales will continue through August 2018. Demand was strong at the last set of daily auctions.
Argentina gives new GM soybean seed the green light amid glyphosate concerns... Late last week, Argentina approved the use of genetically modified soybean seed resistant to herbicides other than glyphosate. This comes as The European Union, its No. 1 market for soymeal and soyoil and its No. 3 market for soybeans, remains on the fence about whether to extend the license of weed killers containing glyphosate. The Argentine ag ministry in a statement said there is a need for the SYN-00H2-5 seed that can be used with different herbicides that have not raised health concerns around the world.
Cropland is shifting to larger farms, even as average size changes little... Between 1982 and 2012, the average (or mean) acres of cropland and harvested cropland changed little. Acreage averages have been stable because the largest and smallest crop farms grew in number, while farms in the middle declined. With only small changes in total cropland and total crop farms, average acreages changed minimally. The trend in midpoint acreage... at which half of all cropland acres are on farms with more cropland than the midpoint and half are on farms with less... captures the consolidation of cropland better than average acreage. As cropland shifts to larger farms, the midpoint increases. Between 1982 and 2012, midpoint acreage for both cropland and harvested cropland roughly doubled to about 1,200 acres each. This shift was aided by technologies that allowed a single farmer or farm household to farm more acres.
Early arrival of Thanksgiving expected to benefit beef market... The early calendar arrival of Thanksgiving this calendar year is expected to give retailers an extra week in November to feature beef. Over the past week, prices for premium beef have climbed while Select values have basically held steady. Traders will be watching the product market closely to kick off the week both for a read on holiday demand and for likely cash market prospects. Last week, cash cattle prices dropped less than feared.
Cash hog prices have stabilized... Traders will be watching the product market this week for a gauge of clearance over the holiday weekend. On Friday, the pork cutout value climbed 84 cents, though movement was light (as is typical for the Friday following Thanksgiving) at 209.99 loads. Cash hog bids strengthened last week, hinting that the product market may finally be stabilizing. But ample supplies will limit the cash market's upside potential.
Weekend demand news... South Korea tendered to buy up to 12,000 MT of rapeseed meal and 12,000 MT of canola meal from Canada, Australia, Japan or China. It is also seeking 24,000 MT of palm kernel expeller meal and 6,000 MT of copra meal from Southeast Asia. Algeria issued an international tender to buy 50,000 MT of milling wheat from optional origins. Taiwan tendered to buy 81,780 MT of grade 1 milling wheat from the United States.