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Corn and soybean futures finished higher Thursday, a day ahead of the release of a delayed November USDA Crop Production report and world supply/demand estimates. The federal government shutdown, which ended Wednesday night, left farmers and other market participants without crop production or supply/demand figures since the last round of reports on Sept. 12. Yield adjustments – analysts look for further cuts to corn and soybeans – are front and center.
Don’t miss: 4 key things to know ahead of USDA Crop Production and WASDE reports
Market participants will also be focused on soybean export figures for a steer on how USDA is factoring in a deal the Trump administration says has seen China agree to buy 12 million metric tons of soybeans by January and another 25 million metric tons a year over the following three years. Beijing has yet to formally announce an agreement to those terms and a lack of visible activity after an initial flurry of purchases around an Oct. 30 meeting between President Donald Trump and Chinese leader Xi Jinping has sparked some market anxiety.
And there will be another wrinkle to Friday’s data dump. USDA suspended the reporting of daily flash export sales and weekly sales during the shutdown. On Thursday, the department released a timetable for release of the weekly figures, while announcing that it would release daily flash sales data covering the period from Oct. 1 to Nov. 13 at 11 a.m. CT on Friday alongside the crop production and supply/demand reports.
USDA opens sterile-fly facility
USDA on Thursday announced the opening of a sterile fly dispersal facility in Tampico, Mexico, as part of its effort to halt the spread northward of the New World Screwworm, an outbreak that has resulted in the U.S. closing the border to imports of Mexican feeder cattle.
“The facility will ensure flexibility and responsiveness in northern Mexico, giving us a greater ability to drop sterile flies and continue to push the pest south,” said Agriculture Secretary Brooke L. Rollins, in a news release.
The USDA’s Animal and Plant Health Inspection Service closed the U.S.-Mexico border to livestock imports in November of last year following the reemergence of New World Screwworm in Mexico. The border reopened in February, but imports were suspended again in May after the pest continued to spread northward. In July, USDA scrapped a plan for a phased reopening of southern ports after the pest was detected just 370 miles south of the U.S.-Mexico border.
Fat cattle and feeders have both sold off sharply since mid-October after President Donald Trump said the administration had come up with a plan to lower beef prices. A subsequent decision to quadruply Argentina’s beef import quota was also a psychological blow to the market, though economists said the move was unlikely to move the needle on U.S. beef prices or have much fundamental impact on cattle prices.
Talk of reopening the border has also been a factor, though USDA has yet to announce a timetable.
In an interview earlier this week with Dairy Herd Management’s Karen Bohnert, Rollins said USDA is “looking now to figure out how to start reopening ports.
“I think we’ve gotten our arms around exactly what the problem is,” she says. “We’re building out new sterile fly facilities, which is the only way we eradicated it 30 to 40 years ago, but we have a really good system in place.”
Ethanol production retreats from record
Ethanol production declined to 1.075 million barrels a day in the week ended Nov. 7, according to the Energy Information Administration. That’s a decline of 48,000 barrels a day from a record 1.123 million barrels a day set the previous week.