Good morning!
As of 6 a.m. CT, December corn was up ¼ cent. January soybeans were 1 ¼ cents lower, with December soybean meal down $0.10 and December soybean oil down 2 points. December soft red winter wheat fell 1 ½ cents, with December hard red winter wheat down 4 ¾ cents.
Soybeans rallied sharply, while corn scored gains and wheat was pulled higher on Tuesday following USDA data, highlighted by an unexpected cut to soybean ending stocks and a larger-than-expected cut to corn production. But bulls have struggled to follow through on the upside, with Tuesday’s post-report high at $4.55 ½ set to mark stiff resistance for December corn. USDA’s weekly export sales report will be released Friday, a day later than usual due to the Veterans Day holiday on Wednesday.
In key outside markets, a continued firm tone for the U.S. dollar following hotter-than-expected inflation data earlier this week is also providing a headwind for commodity futures. The ICE U.S. Dollar Index was up slightly early Thursday after hitting a 19-month high overnight. The yield on the 10-year Treasury note was at 4.999%, while Nymex WTI crude oil futures were off 0.7% at $85.95 a barrel. U.S. stock-index futures pointed to a lower start, with investors glued to the fate of Nvidia CEO Jensen Huang – a saga that also carries implications for grain futures (see item below).
Nvidia scandal roils Trump-Xi meeting plans… The scandal surrounding Nvidia CEO Jensen Huang’s affair with a suspected Chinese spy matters for ag commodities because it poses a risk to U.S.-China trade relations. News reports said Nvidia’s board was weighing whether to oust Huang. Bloomberg reported that preparations for Chinese leader Xi Jinping’s third summit meeting of the year with President Donald Trump were going off course due to the spy allegations. The accusations, which China denies, have given Washington lawmakers ammunition to tighten curbs on exports of semiconductors days before the leaders are set to meet at the Asia-Pacific Economic Cooperation gathering in Shenzhen. Trump and Xi in September extended a trade truce reached in South Korea last year until January.
- “This is the first major test of the truce,” Jeff Moon, president of China Moon Strategies and former assistant U.S. trade representative for China affairs, told Bloomberg. “If it’s true that Chinese espionage tried to, or did steal, Nvidia technology, then the U.S. has to respond. At the core of the truce were U.S. commitments not to increase tech restrictions, and Chinese agreement to provide critical minerals. So this episode gets right at the heart of the tech restrictions.”
Deep South set for frost and freeze… The stage is set for a polar air mass over eastern Canada to plunge into the eastern half of the U.S. through the next few days as an anomalous shift in the weather pattern takes place across North America, the National Weather Service said. In the meantime, a low pressure system being energized by this weather pattern is bringing scattered thunderstorms and gusty winds across the Ohio and Tennessee Valleys early this morning, the forecast said. High temperatures will run well below normal by Friday, and overnight lows will fall into the 20s across much of the central U.S., the NWS said. Below freezing temperatures are forecast to reach the Deep South by Saturday morning, setting the stage for a widespread frost and freeze across the South and Southeast this weekend.
U.S. envoys to speak with Putin… U.S. envoys Jared Kushner and Steve Witkoff arrived in Moscow for talks with Russian President Vladimir Putin, the BBC reported, a day after U.S.-mediated talks aimed at ending the war in Ukraine concluded in Abu Dhabi. The U.S. negotiators were due to meet Putin at midday in Moscow on Thursday and were then scheduled to fly to Dublin to speak with Ukrainian President Volodymyr Zelensky. Kushner on Tuesday said the U.S. had seen “some openings and some opportunities” and that they would attempt to make progress in their meeting with Putin.
Russia doubles diesel exports… U.S. efforts to bring down diesel prices saw President Donald Trump ease curbs on Russia, though no shipments have reached the U.S., the Financial Times reported. Russia shipped 271,000 barrels a day of diesel in October, compared with 135,000 barrels a day in the month before, the report said citing data provider Kpler. Russian exports did increase to Brazil, Turkey and other parts of the world.
Democrats flip another Senate seat… Challenger Scott Colom defeated Republican Sen. Cindy Hyde-Smith to become the first Democrat to be elected to the Senate from Mississippi in more than four decades. Hyde-Smith posted a concession video on social media, and a spokesman for her campaign confirmed she had called Colom to concede, the Associated Press reported. Colom’s win after a prolonged ballot-counting process gives Democrats and Democrat-aligned independents 55 seats in the 100-seat Senate, a net pickup of eight seats in last week’s midterms. Alaska’s Senate race is yet to be called. Hyde-Smith is a member of the Senate Agriculture Committee and is chair of its Subcommittee on Commodities, Derivatives, Risk Management, and Trade. Colom, in his Senate campaign, said he would fight for a seat on the Senate ag panel.
65 active New World screwworm cases… More than 40 cases of New World screwworm have been confirmed so far in November, making it the worst month for outbreaks since the pest first appeared in Texas earlier this year, Bloomberg reported, citing USDA data. Cases began accelerating in October, when NWS spread to Arizona for the first time. There have been a total of 128 animal cases, including two in wildlife, as well as six fly trap detections, according to a dashboard maintained by USDA’s Animal and Plant Health Inspection Service. There are currently 65 active cases, with the most recent detection being a horse in Otero County, New Mexico, on Wednesday.
Trade nominee targets China beef imports… Greg Ibach, USDA’s nominee for undersecretary of agriculture for trade and foreign agricultural affairs, told the Senate Agriculture Committee this week that the U.S. needs to engage China to ensure beef plants are authorized to export to the country, Agri-Pulse reported. Asked about how the U.S. can get China to buy more beef, Ibach said: “We have a number of plants across the United States that have been delisted for one reason or another, and I think we need to press on China to try to relist those plants to make them eligible once again to be able to export into China.”
Japan sees first bird flu of season… A government spokesperson on Thursday confirmed Japan’s first bird flu case of the season at a poultry farm in Kyoto prefecture, Reuters reported. The avian influenza has killed 14 birds at the farm in Kameoka city in western Japan, the farm ministry said. The country has begun culling about 200,000 chickens there after testing confirmed the virus, the report said. “The government is asking poultry farmers to make sure they follow strict hygiene,” Chief Cabinet Secretary Minoru Kihara said.
France’s farm-revival campaign… France is on a drive to revive agriculture and food industries with nearly 1,000 projects valued at $8.7 billion to counter the effects of climate change and limit reliance on imports, Bloomberg reported. The investments by Europe’s biggest agricultural producer would add 24 billion liters of milk, thousands of poultry farms, flour factories, and other processing plants to help limit imports of finished products, according to an agriculture ministry booklet distributed Thursday.
Palm oil extends rise… Malaysian palm oil futures built on their recent rebound to trade near MYR 4,450 per ton, boosted by a weaker ringgit and firmer trade in rival edible oils on China’s Dalian exchange, according to Trading Economics. Prices have bounced off their lowest level since early March, supported by bargain hunting after a smaller-than-expected build in stocks, the report said. October inventories rose to a record 3.62 million metric tons, but were below market estimates of 3.75 million tons.
Live cattle see corrective pressure… December live cattle fell $0.225 to close at $218.975 on Wednesday. January feeder cattle gained $1.125 to $327.80. Live cattle saw some corrective selling pressure after recent gains, while feeders were lifted by short covering and perceived bargain buying.
Hogs see modest short covering… December lean hog futures rose $0.225 to finish at $56.025 Wednesday, buoyed by lukewarm short covering and bargain hunting after last week’s round of contract lows. The CME cash index continues to trend lower, projected Thursday at $59.78, down $0.21. But the index is showing internal signs that it may be bottoming out.