December 18, 2018

Good Morning,

Markets are steady this morning with corn up 1 and soybeans up 5. Lack of any news and holiday season have the markets stagnant for the time being.
President Trump announced that a second round of payments would be coming for US farmers for soybeans. The President also told the Fed not to make another mistake and raise interest rates too much.
President Xi Jinping told an audience of party officials, military leaders that “no one is in a position to dictate to the Chinese people what should and should not be done” in a speech. “There is no textbook of golden rules to follow for reform and development in China, a country with over 5000 years of civilization and more than 1.3 billion people”. Who these comments were exactly referencing was not stated, but most believe it was the US.
I would advise producers to start looking to make sales for October/November of 2019 at the current levels. We are currently in the 70th percentile for the last five years with current prices in the $3.70-3.75 range. Any sale that can be made at or above this percentile is strongly recommended. If we increase corn acreage in 2019 by 4-5 million acres next year and drop yield back to 175 bpa we could very easily push next year’s carryout over 2.0 billion bushels.

Have a Safe Day!

Garry Gard
920-348-6844
ggard@didionmilling.com

December 17, 2018

Good Morning,

Grain markets have opened steady this morning with corn down 1 and soybeans up 3. The watch continues for any additional reports of Chinese business. Most traders appeared to be disappointed with last week’s totals but remain optimistic about future sales. The chance of any big export numbers in the coming months is limited as the deals are still not worked out and South American bean harvest is only a couple months away from hitting the ports. The Trump administration has set March 2nd as the firm deadline for arriving at a deal with China. If nothing is completed by that date additional tariffs of $200 billion will be imposed on Chinese goods.
There are still no firm details on the 2nd part of the MFP payment to farmers to help offset the trade war with China. Some traders are speculating that an announcement will come in conjunction with the signing of the new farm bill as early as next week.
We continue to be stuck in a sideways trading range between $3.80 – 3.88 for March futures. Barring any news on trade talks this range should hold thru the end of the year.

Have a Safe Day!

Garry Gard
920-348-6844
ggard@didionmilling.com

December 14, 2018

Good Morning,

Buy the rumor, sell the fact reaction in the markets yesterday resulted in the soybeans selling off which pulled corn lower. Chinese soybean sales numbers that were not even close to the 5 to 8 MMT rumors that came from last week’s meeting had traders in a sell mode. In positive news the Chinese did announce that beginning January 1, they would suspend their tariffs on $126 billion of US automobiles and products. This is another confirmation of the Presidents promise that tariffs on US autos would revert back to the 15% level before the trade war began.
I would advise producers to start looking at making sales for October/November of 2019 at the current levels. We are currently in the 70th percentile for the last five years with current prices in the $3.70-3.75 range. Any sale that can be made at or above this percentile is strongly recommended. If we increase corn acreage in 2019 by 4-5 million acres next year and drop yield back to 175 bpa we could very easily push next year’s carryout over 2.0 billion bushels. This is why I would advise producers to have a minimum of 20% of your fall corn sold at this level.

Have a Safe Day!

Garry Gard
920-348-6844
ggard@didionmilling.com

December 13, 2018

Good Morning,

Corn is currently even, and soybeans down eleven. Trade saw China purchase 500,000 tonnes of soybeans, the first since the G20 Summit. This is encouraging progress, though many traders were expecting a number ten times higher. US House and Senate passed the farm bill, with Trump the final stop for signature. House vote was 369-47, the bill that 40 million Americans depend on for SNAP.

In my opinion, these headlines are proving that corn has a stable/positive outlook at this time. With that being said, make sure to have firm offers in place and make your targets known. Keep in mind some bids that have been stable over the past week: January $3.60, June $3.75, October $3.73.

Have a Great Day!

Mitch Giebel
920-348-6861
mgiebel@didionmilling.com

December 11, 2018

Good Morning,

Overnight China and the US discussed the road map for the next stage of their trade talks. Both sides exchanged views and worked out details for continued meetings when the Chinese delegation comes to the US.(A meeting in DC is expected soon). There are rumors of a purchase of 5-8 mmt of beans getting bought this week from China. China imports close to 7 mmt/month, so this number seems about right.
USDA crop report out at 11am today with little surprises expected. Corn carryout is expected to increase slightly from the November report. Estimates for today’s report are listed below.

2018-19 Ending Stocks (million bu)
December 11 Average Est. USDA November
Corn 1.781 1.744 1.736
Soybeans 955 938 955
Wheat 974 969 949

2018-19 World Stocks (million metric ton)
December 11 Average Est. USDA November
Corn 308.8 308.4 307.5
Soybeans 115.3 113.2 112.1
Wheat 268.1 267.3 266.7

Have a Safe Day!

Garry Gard
920-348-6844
ggard@didionmilling.com

December 10, 2018

Good Morning,

Markets are slightly lower this morning with corn down 1 and soybeans down 4 to start the week.
Look for grain trade to take direction from the stock market trade this week.
We will be monitoring the same news this week as traders wait for some news on the trade front. Vice Premier Lui is coming to Washington DC this week with a 30 member delegation to start trade talks. It is likely that Ag and Energy purchases will be made on follow thru from what was agreed upon at the G20.
An announcement of was supposed to happen on the second aid package for soybeans last week, but has not yet been confirmed. I have heard that offices were to be prepared to start filing paperwork as soon as today.
The USDA December Supply and Demand report will be released tomorrow at 11am. Yield will not be updated on this report, but we do expect to see changes in carryout of both corn and soybeans. Continued low export numbers in soybeans and lower ethanol margins in corn are expected to increase ending stocks in this report. I don’t expect much reaction to tomorrow’s report as historically this report generates little interest as traders await the final report in January.

Have a Safe Day!

Garry Gard
920-348-6844
ggard@didionmilling.com

December 6, 2018

Good Morning,

Corn is down 4 and soybeans are down 15 to start the day. Traders are becoming more skeptical that tension between the US and China is easing. One sign, China has said they will be buying US commodities, however they have not dropped or lowered tariffs.
The corn market has no direction as domestic demand looks to slow with poor ethanol margins. With no fundamental direction, corn is basically following soybeans as we wait for the January 11th USDA report on the final size of the 2018 crop.
Producers looking or needing to move grain before the end of the year have little hope of the market rallying into the end of the year and should take advantage of current cash prices. Producers that can hold off until the January 11th report will have more opportunity and I would advise putting in firm offers and waiting.

Have a Safe Day!

Garry Gard
920-348-6844
ggard@didionmilling.com

December 5, 2018

Good Morning,

Softer markets overnight and this morning as we give back some of yesterday’s gains as uncertainty remains around the Chinese-US trade truce. The ag markets are starving for more detail as we await the next piece of news around this last weekend’s talks and any future discussions. China’s government hasn’t been able to formulate a response to the summit this last weekend with President Trump because President Xi and his senior officials are still out of the country.

Without a weather issue in South America the demand for US beans will continue to shrink regardless of trade talks. With US bean carryout’s approaching the 1 billion bushel level in the last report, it will take some time and a lot of demand to bring these levels back down.

So far this week the markets have gained 7 cents in corn and 18 cents in soybeans in what may be a buy the rumor sell the fact move.

Have a Safe Day!

Garry Gard
920-348-6844
ggard@didionmilling.com

December 4, 2018

Good Morning,

The corn market was lower overnight and is currently unchanged as traders don’t feel they have seen enough details from the US-China talks over the weekend. China remains silent regarding the trade truce that was apparently agreed to with the US. They have not agreed to buy large amounts of US commodities, nor have they agreed to lower tariffs on soybeans. President Trump did agree to delay any further tariffs for 90 days, but stated that all existing tariffs will remain in place until further notice.
Harvest progress was reported at 94% complete in corn and soybeans for the US in last night’s report. Wisconsin came in at 88% complete in corn and 94% complete in soybeans.
Sunday night’s markets gapped higher in both corn and soybean markets which I think will be filled in the coming week or weeks. Look for the markets to trend sideways to slightly lower with these gaps in mind.

Have a Safe Day!

Garry Gard
920-348-6844
ggard@didionmilling.com

November 30, 2018

Good Morning,

Futures at the CBOT are higher with corn up 5 cents, beans up 5 and wheat up a 4 cents as well. News early this morning of a new NAFTA agreement has also helped brighten the mood heading into the pivotal Saturday meeting at the G20 between President Trump and Chinese President Xi.
Things started out slightly lower overnight, but recovered as hopes grew that Trump and Xi will be able to iron out some of their differences over trade and come up with some sort of truce. Any truce will likely need concessions from China to end their tariffs on US soybeans and other goods. An agreement, even if it is rudimentary, might prevent current US tariffs on $200B of Chinese goods from rising from 15% to 25% and provide the time necessary to negotiate the details of much a broader framework.

Obviously there is another outcome from Saturday night’s dinner that is significantly less desirable. It would not take a very big stretch of the imagination to see the two leaders unable to come to an agreement and the trade war escalates with our current tariffs rising to 25% and the possibility of tariffs on another $270B of Chinese goods becoming a reality.

I would advise producers to be making some sales for summer and fall of 2019 at current levels. July $3.70 and Oct/Nov $3.65-3.70 levels are on the table and should be grabbed.

Have a Safe Weekend.

Garry Gard
920-348-6844
ggard@didionmilling.com