Corn – Trade again taking a slightly cautious approach into a USDA report, ethanol remains strong
↑ Yesterday’s ethanol remained strong at 1102K, still ahead of the USDA expected pace
↔Analysts look for a 63 mil bu yield decline tomorrow which would likely raise fair value to around
480 – 490 yet futures remain slightly cautious ahead of the report priced in the 450’s
↑↓ We have seen slow fund buying since mid-July that has continued through last week at the same
time smaller speculators continue cautious selling which slows the overall rally
↑ The USDA has lowered corn carryout 6 months in a row, funds have been buying corn for 6 months in
a row, looks as though funds are simply following the fundamentals that the USDA is suggesting
Beans – Exports delayed until tomorrow, seasonal export setback expected this week, cautious trade
↔Exports are delayed until tomorrow due to today’s early 12:05 close in observance of Jimmy Carter
↓ Even though exports are normally slow for this week’s report (average is around 350K) it is likely
cautious traders are only looking at the total export number and seeing it as disappointing
↓ The ARG forecast still has some light rains that were added yesterday, southern BRA rains are a bit
heavier but likely not reaching normal levels just yet
↔Bean reproduction in BRA starts next week, that means the most important time to watch weather
maps for BRA/ARG over the whole growing season is next week through early February
Wheat – Exports likely expected slow tomorrow, also expecting a small carryout increase
↓ Trade will likely be expecting both another slow export report tomorrow as well as a small carryout
increase, this could mean light pre selling seen today
↔There are 2 HRW moderate cold events on days 4 – 5 and again on days 11 – 13 but as of now
neither are extreme enough to catch much weather fear support
Cattle – Reports of a possible border opening Jan 20th, packers hold tight to their $200 NE cash bids
↔Yesterday’s PM BB was choice +2.82 select +1.46 packer BE at 201.77, packer cushion $5.20
↓ Yesterday Drovers reported a story about the Mexico border opening on Jan 20th, we have not seen
official word from the USDA or other source but that story was enough to cause feeders to ease
↓ In total it is not an exaggeration to say a Mexico border opening could cause a $10 - $15 setback in
feeders, we see trade eased back almost $3 yesterday, a sign of caution but still waiting for official word
↔Packers held ground with their $200 cash bid yesterday, we will see if that bid changes today