January 7, 2019

Good Morning,

Weather is not the only thing that is unseasonable this week as we found out on Friday that the USDA will not be releasing its Crop Production report this coming Friday. The US government shutdown is entering its third week, with no end in sight. The USDA had delayed several major US and world reports because of the shutdown and has said they will set a new date for the Crop Production report once funding is restored. The lack of key data for traders has and will lead to a lot more speculative trading until we can confirm numbers.
The fundamental news that we have to trade for the time being is South American weather and US trade talks. Below normal rainfall and above normal temps are forecasted for Brazil over the next two weeks. Argentina on the other hand is wetter with heavy storms every 1-3 days over the next two weeks.
Chinese and US officials are meeting in Beijing this week for the first face to face talks since President Trump and President Xi Jinping agreed in December to a 90 day truce in the trade war.

Didion is currently offering a contract allowing you to sell cash corn for February 2019 delivery at $3.70 with a potential contract for December 2019 delivery at $4.00. Call for details.

Have a Safe Day!

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

January 4, 2019

Good Morning,

Currently corn is up 2 and soybeans are up 4 on carryover from yesterday’s trade strength. Traders are adding premium to the market due to dryness in parts of Brazil and flooding in northern Argentina. Rain is expected for the dry areas of Brazil over the weekend and dry for next week. This dryness could have a big impact on the second crop corn plantings.
The USDA will announce their decision today on whether the January 11 final production, Dec 1 grain stocks and winter wheat seedings will be released on the 11th at it regular time or if it will be delayed due to the government shutdown.
Producers with old crop corn to move before spring planting should be paying close attention to the markets and looking to lock in cash or basis contracts. Look to make sales before grain needs to be sold in March to pay bills for spring planting and basis levels widen out. Any potential rally in corn futures will also put pressure on basis levels.
Didion is currently offering a contract where you can sell cash corn for February 2019 delivery in the $3.65-3.70 range with a potential contract for December 2019 delivery at $4.00. Call for details.
Have a Safe Day!

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

January 3, 2019

Good Morning,

Corn is up 1-2 this morning as traders continue to look for direction from the other markets as trade awaits any positive news from the demand side. The USDA’s chief economist said they will decide tomorrow if they will delay the crop reports scheduled for January 11th due to the partial government shutdown. There has been no deal or indication that a deal would happen to end the shutdown. President Trump and key Democrats are meeting tomorrow as Democrats take over the House today.
Soybeans are up 5-6 this morning after yesterday’s strong performance on rumors China was looking to buy 1-2 mmt of US soybeans. US and Chinese officials are set to meet face to face starting January 7th.
I would advise producers to get firm offers in with your local grain buyers for the 2018 and 2019 crops. I don’t expect any adjustments in the USDA’s Supply and Demand charts to be big enough to move the grain markets significantly higher. With more corn acres next year and South American soybean starting to hit the market place in the next couple weeks, I expect more sideways movement in the markets with few opportunities to capture higher prices. The best chance to catch higher prices on any bounce are with firm offers. Producers should target $3.50-$3.75 for their next old crop sales and 3.70-3.75 for their next new crop sales. We are currently in the 70th percentile for the last five years with prices in the $3.70-3.75 range for fall 2019 delivery. 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 31, 2018

Good Morning,

Ag futures prices are trading lower as traders look to put an end to what has been to say the least a very tumultuous 2018. Grain markets are closed New Year’s Day. March corn continues to hang around the $3.75 price level. After a difficult second half to December, March beans are up 5 and trading within striking distance of the psychologically important $9 level to close out the year.
Grain markets and financial markets alike are eager for more news concerning U.S.-China trade negotiations, after President Donald Trump reports he had a “very good call” with Chinese President Xi Jinping last Saturday. News of the phone call between the two Presidents is helping to support the summer row crops with President Trump proclaiming that “big progress” is being made on a variety of trade and IT/IP fronts between the two nations.

I look for the markets to close lower today with month end and year-end sales as traders regroup to start the New Year.

Have a Safe and Happy New Year!!!

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

December 28, 2018

December 28, 2018

Good Morning,

Corn opened up two, and Soybeans up ten. Low trade volume with the second to last trade day of the year. There has been a lot of uncertainty between the trade war and government shutdown still in the picture, trade is looking for any ideas on volumes that could possibly be booked on Chinese purchases. With that being said, USDA weekly export numbers will not come out today due to the government shutdown.

Brazil’s Mato Grosso region has questions on their potential soybean yields, as some farmers are reporting dryer conditions. Do not expect any major yield adjustments, but be aware of some of those headlines on South American crops affecting our markets.

My belief is that with end of month/year positioning there looks to be a more positive than negative start to 2019. News about a US trade delegation came in yesterday, with a date of January 7th meeting in Beijing. Watch for news from this, as China could be potential buyers of corn, ethanol, and ddgs. Take time to call and talk on either basis or cash levels before or after the holidays. Current cash levels to keep in mind: March $3.50, $3.70 July, and $3.75 December.

Have a Great Weekend!

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

December 27, 2018

Good Morning,

The markets are trading slightly higher as it tries to recover from yesterday’s selloff. We opened firm coming back from the Christmas Holiday yesterday before a lack of willing buyers due to any export data. With a lack of fundamental inputs, the pros will turn to the charts for direction. Fund managers are basically flat the beans, wheat and liquidating some of their long position in corn. The question for today is whether the rally in the grain markets can be sustained?

Farmers and ranchers need to prepare for more losses in their next-biggest Asian market, Japan. Japan, unlike China, isn’t moving to block US goods by retaliating for the White House’s tariffs. Instead, it is taking the opposite approach and accelerating an ambitious market-opening agenda with more than three dozen countries and excluding the US. Beginning on December 30th the Japanese will begin cutting tariffs and easing quotas on products sold by some of America’s biggest agricultural competitors including Canada, Australia, New Zealand and Chile as part of the new 11-member Comprehensive and Progressive Agreement for Trans-Pacific Partnership.

Have a Safe Day!

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

December 24, 2018

Good Morning,

Corn and soybeans were each down 3 overnight. I look for light trade and little movement either direction this week as traders enjoy the holiday week. Shortened trading hours this week with the markets closing at 12:05 pm today and closed tomorrow.
The Chinese Ministry of Commerce stated on Sunday that China and the US held a vice-ministerial level call on Friday, the second such call in a week, to have a deep exchange of views on trade imbalances and the protection of intellectual property. No further details were released, but the ministry’s web page stated that the two countries made new progress on the issues and discussed timetables, further calls and mutual visits.
While I don’t see an immediate impact, the current government shutdown could impact the grain markets in the coming weeks. Traders are looking forward to the January 11th Crop Production and S&D report to see what the final yield for the 2018 crop is going to be and if stocks will be adjusted due to lower ethanol demand and lower exports. The shutdown means that traders may have to wait longer for this report as the following are USDA activities that would not be continued:
• NASS statistics, World Ag Supply and Demand Estimates reports, and other ag economic and statistical reports and projections.
• ERS Commodity Outlook Reports, Data Products, research reports, staff analysis and projections. The ERS public website would be taken offline.
Activities that would continue in the short-term:
• Some farm payments including direct payments, market assistance loans, market facilitation payments and disaster assistance programs.
• Trade mitigation purchases made by USDA’s Ag Marketing Service.

Have a Merry Christmas!

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

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