- USDA’s daily export reporting service did report private U.S. exporters sold of 245,872 MT of corn for delivery to Mexico during the 2019-20 marketing year this morning.
Soybean futures are 3 to 4 cents higher but near midrange after failing to hold early advances.
- After rising to $8.94 this morning, the highest level in more than a week, the market has setback at midsession. January beans face strong resistance at $9.00 to $9.10.
- China announced earlier today that is could waive tariffs on unspecified quantities of U.S. soybeans and pork as a goodwill gesture as the two sides approach the Dec. 15 declines for the next round of U.S. tariffs on Chinese goods. Any new business is appreciated but this primarily serves China’s needs, with supplies from Brazil still three months away.
- Ironically, today’s strong U.S. jobs report for November along with upward revisions to job growth in October and September may give the White House negotiators the confidence to take a harder line with China and seek greater concessions.
- While Brazilian bean development continues to improve, the return of rains to Argentina to relieve dry conditions remains uncertain. If widespread showers and rains fail to develop by Christmas, traders may have reason to add weather premium back into the market.
Winter wheat futures are down 1 to 3 cents, and spring wheat futures are up about 1 cent.
- February cattle extended Thursday’s gains before stalling just below the 20-day moving average.
- Cash cattle are trading about $1 higher this week, lending a firm tone to futures
- Cash markets gains came despite a slide for the product market. Wholesale beef prices continued to slide lower, with Choice down $1.35 and Select cutouts falling $2.19 on Thursday.
- Sales were moderately active and another positive sign that demand remains robust.
- The surge in November U.S. job growth and higher wages bodes well for strong beef demand into 2020.
Lean hog futures are moderately higher, but off session highs.
- Lean hogs rose on China’s plans to cut tariffs on pork. But details on this are limited right now.
- Wholesale pork cutout values rose 36 cents amid mixed trends in primal cuts. Sales were slow to moderate.
- Still, the national average cash hog prices rose 75 cents Thursday, adding to the positive undertone to start trading.
- Lean hog futures softened Thursday, with deferred months leading losses. That action was in part driven by USDA’s weekly export sales update that included a net pork sales reduction of 1,400 MT for 2020 as 8,500 MT in reductions by China more than offset new business from other nations.
- But sales of 30,600 MT for 2019 were up 5% from the prior four-week average, despite the fact the reporting period included Thanksgiving.