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AgMaster Report 11/17/2020


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JAN BEANS

After the bullish surprise offered by the USDA last Tuesday, the mkt has resumed its attention on South American weather & Chinese exports! With ending stocks only at 190 mb – at a 5-6 year low – clearly there is no room for error in Brazil – the world’s largest soybean producer! And even though they had some rains over the W/E, they weren’t near enough as El Nina continues to slow both planting & crop development! And China – with its flooding issues & re-growth of its livestock herd, continues to have a voracious appetite for our corn & beans! So stocks continue to dwindle –more is going out the front door than coming in the back! And the macros still support with a lower $$ & higher vaccine driven DJI!

DEC CORN

After the positive Nov WASDE Report, Corn ending stocks dropped to 1.702 mb (2.167) production to 14.507 (14.722) & yields to 175.8 (178.5) – and supplies could continue to fall with the ongoing stellar exports & deceasing production estimates out of Brazil & Argentina! And whereas we’ve had a solid $1.00 rally, we’re still historically in the bottom 20% of a 10-year price range! With with the very positive vaccine news today, a sharp economic recovery could be right around the corner – meaning more driving & more ethanol demand! Not too long ago, we had abundant carryover but not anymore! THE WORM HAS TURNED! So once again, there’s NO MARGIN FOR ERROR!!

DEC WHEAT

Dec Wht continues in its “weak sister” role – garnering  most of its strength from coat-tailing the gains of corn & beans rather than extracting any power from its own fundamentals!  The reason that wht is constantly battling the formidable headwinds of record global stocks & stocks/usage ratios & mostly lackluster exports! There have been some “dry issues” in Russia & the US Plains but their bullish impact seems to have been dialed in!

DEC CATTLE

Since early July, Dec Cat has been confined to a broad $10 range (104-114)! The Covid pandemic has really muddied the “fundamental waters” – one day we’re re-opening the next day we’re shutting down! For instance, now, with the brutal resurgence, many restaurants are closed for indoor dining & Thanksgiving get-togethers will be markedly smaller if not non-existent! And most probably the same for Christmas parties & celebrations! Yet with the threat of a complete shut-down, people are flooding stores -stocking up! Meanwhile slaughters have stayed constant! A November Cattle-on-Feed Report will be issued Friday at 2pm! We’re leaning to the upside – as we feel its “darkest before the dawn” and that the imminent vaccines will hit after the first – expediting an economic recovery & improved bee demand!

DEC HOGS

After a stunning $23 rally (49.50 – 72.50) commencing in early August, Dec Hogs have fallen $9 (72 – 63) – succumbing to crumbling demand both domestically & abroad! The Covid Resurgence has once again shut down US restaurants & China has repeatedly said they will be importing less US pork in 2021 as they rebuild their hog herds – previously decimated by the Asian Swine Flu! So the mkt – after correcting -is sideways trading – looking forward to 2021 when a vaccine-inspired economic recovery should be underway – which promises to augment domestic pork demand!



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About the author


Mr. Moore’s commodity career unwittingly began when he was 5 years old, spending his summers working for his family farm near Quincy, IL.

Bill attended Cornell University, graduating with a degree in Civil Engineering and then studied at the University of Chicago for his MBA. Soon after graduation, he entered into the United States Marine Corps.

In 1975, Bill began working at the Chicago Mercantile Exchange as an Agricultural Specialist – trading corn, beans, wheat, cattle & hogs. In 2000, he moved to the Chicago Board of Trade to work for a futures brokerage firm. Then, in early 2011, he brought his business to The PRICE Futures Group where he deals exclusively with 1000 acre grain farmers, helping them to design their seasonal corn and bean hedging programs.

Contact William Moore: (800) 769-7021 or at wmoore@pricegroup.com

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