You are here

3 Big Things Today, October 15, 2019

Corn, Wheat Slightly Lower Overnight; U.S.-China Trade Deal Draws Skepticism.

1. Corn, Wheat Slightly Lower, Beans Little Changed Overnight

Corn and wheat were slightly lower, while soybeans were little changed overnight on uncertainty about the ongoing trade war between the U.S. and China and on mixed weather forecasts.

The U.S. on Friday announced a “partial” trade deal with China, but skepticism has emerged about whether the sides actually will sign an agreement. The questions are healthy considering both sides have made announcements on trade talks in the past only to let down market-watchers.

“The Champagne should probably be kept on ice, at least until the two presidents put pen to paper,” China Daily, the state-owned English newspaper said on Monday.

Still, if a deal is signed, Beijing would be on the hook to purchase tens of billions of dollars worth of U.S. agricultural products.

Traders, producers, and analysts are all watching the weather as storms that struck North Dakota and South Dakota that left up to 2 feet of snow in some areas have moved on, but essentially made it impossible to continue the corn and bean harvest, if crops survived.

Freeze and frost in some areas also may have ended the growing season prematurely, especially for plants that were put in the ground later than normal due to wet weather in the spring.

Corn futures for December delivery fell 1½¢ to $3.96¼ a bushel overnight on the Chicago Board of Trade.

Wheat for September delivery dropped 2¾¢ to $5.08¼ a bushel, while Kansas City futures declined 2½¢ to $4.23¼ a bushel.

Soybean futures for November delivery fell ½¢ to $9.40 a bushel. Soy meal was unchanged at $310.90 a short ton, while soybean oil fell 0.08¢ to 29.92¢ a pound.


To get 3 Big Things Today delivered to your in-box each morning, subscribe to our newsletter here.


2. Partial Trade Deal Announced, Both Sides Seem Cautious Moving Forward

It was another up-and-down week for trade as it was announced on Friday that the U.S. and China had a “partial” trade deal.

Here’s what we know: Under the agreement announced on Friday, the U.S. will cancel a planned tariff-rate increase on $250 billion worth of Chinese goods to 30% that was set to go into effect today.

China, meanwhile, will purchase $40 billion and $50 billion worth of U.S. agricultural products in return.

That’s the good news.

The bad news is that everybody – even Treasury Secretary Steven Mnuchin, who’s been a key player in the high-level negotiations – seems skeptical that the deal will be finalized and that it will look like it did on Friday.

Mnuchin said he wants to be sure China will follow through on its promises. He also said that another round of tariffs scheduled to go into effect in December is still a possibility if Beijing reneges on its commitment to purchase U.S. products.

China wants that December hike off the table, but for now it remains, throwing the status of what’s being called Phase 1 of a trade deal into question.

“I have every expectation if there’s not a deal, those tariffs would go in place. But I expect we’ll have a deal,” Mnuchin said on CNBC Monday.

China, despite the skepticism, also seems optimistic that a trade deal will be implemented sooner rather than later.

Chinese state media on Tuesday said that Beijing and Washington have the same position on the progress of trade talks. Reports out of the Asian country indicate that China is just being overly cautious, as it often is, with the official language it uses to make announcements.


3. Storms, Cold Weather Give Way to Potential Flooding in Northern Plains, Wind in Midwest

The storms and cold weather that have been hitting the Northern Plains and central Midwest the past few days have subsided, and drier, albeit windy, weather has moved in.

Frost advisories that were in effect in parts of northern Illinois and southern Wisconsin are gone as temperatures have risen. Highs in the region are forecast in the low-60s with lows in the mid-40s, according to the National Weather Service.

In North Dakota, where there is as much as 24 inches of snow, flooding is now a concern in some areas as temperatures warm into the 50s this week.

The NWS said in a report that it’s thus far uncertain how much of the snowmelt will soak into soils and how much will run off into rivers and streams.

In eastern Nebraska, much of Iowa, and parts of northern Illinois, wind speeds are expected to be extremely high today. Gusts of up to 40 to 45 mph are expected from mid-morning through this afternoon, the agency said.

Isolated thunderstorms also are possible this morning, mostly east of the Mississippi River, the NWS said. Storms also are expected in parts of central Iowa starting Friday and lasting through Sunday.

Read more about

Tip of the Day

Agronomy Tip: Manage Issues with Fall Fertilizer Applications

Corn in the field with snow. A winter or early spring preplant application of fertilizer will be beneficial if you can't make an application this fall.

Talk in Marketing

Most Recent Poll

How is your harvest progress?