THIs week’s action:

Corn Dec 22 down 3 @ $6.7975

Beans Nov 22 down 7 @ $13.8650

KC Wheat Dec down 21 @ $9.25

Feeders Nov down .325 @ $177.850

Fats Dec up .525 @ $152.925

Hogs Dec down 3.025 @ $86.125

Crude Dec up 2.70 @ $87.58

Recap:

Harvest is quickly ending as analysts project soybean harvest will be about 90% complete by this weekend and corn around 75% complete. Basis has reflected this and is rallying in some markets as harvest winds down and end users have low coverage for Nov/Dec. There is evidence the US is losing soybean export demand to China as they recently booked some Brazilian and Argentine cargoes, which is rare this time of year. US soy export shipments are 19% lower than last this time last year. Half the cargoes China purchased last week were not of US origin.

The president of Mexico has stated he will curb up to 90% of American corn shipments to Mexico by 2024 over concerns of GMO’s. Mexico is our second largest export partner and accounted for about 22% of all US corn exports last year.

Ukraine’s ag minister said winter wheat plantings are expected to be 9.4 million acres this year. For context, this summer they harvested 11.6 million acres after losing about 4.5 million acres damaged from war. In short- Ukraine’s total wheat plantings are about 60% of last year. It is estimated Ukraine is about 80% planted of intended acres. Despite this optimistic story around wheat, importing nation currencies have been beat up lately. This is making wheat very expensive for certain parts of the world.

The Egyptian pound vs US Dollars dropped 17% in just one day this week.

 Forecast:

Rains moved across much of the southern US this past week or so, which was badly needed. It should help HRW get established in the southern Plains and help add depth to the Mississippi River to improve barge logistics. Even with the recent rains, we are entering winter lacking moisture across most of the corn belt, especially in the west.

The GFS is unchanged in South America into the middle part of November. Soaking rainfall of 1-4” impacts Paraguay, Parana, And Sao Paulo in Southern Brazil on the weekend. Regional showers of 1-2” are forecast in Mato Grosso do Sul and Mato Grosso early next week. All but RGDS in far southern Brazil will be well watered on Nov 1. A lengthy drier pattern follows, with little/no rainfall offered to any crop region in South America Nov 1-10. Brazilian soy seeding will race ahead. The return of regular showers will be needed soon thereafter.

Outside Markets:

Third quarter GDP released this week shows the US economy is growing. It stated the US economy grew 2.7% compared following a slowdown during the first six months of the year. Consumer confidence in October rated 102.5 which is a three-month low. Mortgage rates topped 7% for the first time in two decades. This has led to a dramatic slowdown in new home purchases, marking the 10th straight week sales have declined.

US federal public debt was $158,000 per worker in 2019. Today public debt is $202,000 per worker. In 1970, federal debt for each worker was $4,600.

Over the last 50 years, the average rate on the debt was 6.78%. Recently the interest had fallen to 2.12%. If the Fed were to raise rates to meet our 50-year average and, our federal debt would increase $1.18 trillion annually in interest. 

Something that Probably Means Nothing:

The Powerball jackpot soared to a whopping $800 million after Wednesday night’s drawing yielded no grand prize-winning ticket matching all six numbers. The jackpot in Wednesday’s drawing was $700 million and the winning numbers were 19, 36, 37, 46, 56 and a Powerball of 24. The $800 million prize is the second largest Powerball jackpot and 5^th largest US lottery jackpot of all time. Its cash value is $383.7 million. There have now been 36 drawings in a row with no grand prize winner, but unfortunately for ticket buyers (me), the odds of winning the massive prize are just 1 in 292,200,000.

May the odds be in your favor and have a great weekend!