Wheat Spared U.S.-China Pressure; Corn, Soybeans Slip

Date : 11/18/2019 @ 9:58PM
Source : Dow Jones News

Wheat Spared U.S.-China Pressure; Corn, Soybeans Slip

By Kirk Maltais


--Wheat for December delivery rose 0.9% to $5.07 1/4 a bushel on the Chicago Board of Trade on Monday, as grains buyers, turning skeptical about the U.S.-China trade deal, shunned soybeans and corn.

--Soybeans for January delivery fell 0.9% to $9.10 1/4 a bushel.

--Corn for December delivery fell 0.9% to $3.67 3/4 a bushel.




China's Cold Feet: Unlike corn and soybeans, wheat futures didn't feel pressure from pessimism about the many-times-promised-but-yet-to-be-delivered trade agreement between the U.S. and China. News outlets have reported that Chinese officials are troubled that the draft of a proposed partial deal lacks details of a U.S. rollback of tariffs on Chinese goods. This could mean there won't be a trade deal in place before the Dec. 15 deadline for new tariffs.

Darkening Trade Outlook: The prospects for soybeans are dim without a trade deal; China is the world's largest importer of the oilseed. "We believe the Phase One deal gets harder the longer it goes without a signing; there is no real forcing moment other than the December 15 tariff escalation," said Chris Krueger of Cowen & Co.




Underwhelming: The total inspections for soybean exports rose 14% to 1.5 million metric tons this week, with China taking more than half, while corn inspections climbed 9.5%. Still, the numbers are about 6% behind USDA export estimates, according to analysis from INTL FCStone, which could lead to higher-than-expected ending stocks.

Completely Soaked: Grain elevators are experiencing backlogs in the Corn Belt due to the rain and snow of the past month, according to Farmdoc, a publication from the University of Illinois. With wet corn piling up and nowhere to dry it, corn supplies could get squeezed.

Propane Pain: Prices for wholesale propane, a fuel used by many farmers in their grain-drying operations, have jumped roughly 16 cents per gallon this month to 76 cents per gallon, according to data from the EIA. Prices for wholesale propane have now risen roughly 25% since late October. This is adding to farmers' costs at a time when the U.S.-China trade conflict is limiting exports and unseasonable weather has made it hard to grow and harvest crops.




--The EIA releases its weekly update on ethanol production and inventories at 10:30 a.m. ET Wednesday.

--The USDA will release its latest weekly export sales numbers at 8:30 a.m. ET Thursday.

--The USDA will release its monthly Cattle on Feed report at 3 p.m. ET Friday.

--The USDA will release its monthly cold storage report at 3 p.m. ET Friday.


Write to Kirk Maltais at kirk.maltais@wsj.com

(END) Dow Jones Newswires

November 18, 2019 16:43 ET (21:43 GMT)

Copyright (c) 2019 Dow Jones & Company, Inc.

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