News Source: SETZ

Closing Comments; Friday, January 18th, 2019

The government shutdown is in its 28th day, neither parties have been at negotiations since last Wednesday. Leading economists to be concerned that the shutdown could bring economic growth to its slowest pace in several years, as households are cutting spending due to uncertainty.

Rumblings about the possibility of the U.S. lifting tariffs on China provided support to the markets today. Yesterday the Wall Street Journal reported that the U.S. could lift tariffs as a way to break the stalemate in the trade negotiations, however the U.S. Treasury Department is denying such rumors.

The stock market rallied today, due to optimism that a deal to end the trade war with China would be in the works. Reports of China offering to go a six-year buying spree to ramp up imports from the U.S. in order to help reconfigure the relation between the two countries, helped drive the markets.

March Corn ended the day up 1 cents at $3.81 . March Soybeans finished up 9 cents at $9.16 . March Chicago Wheat was unchanged at $5.17 .

For more information, you may contact Kristi Guse at (712)-260-6486, or e-mail at kguse@maxyieldgrain.com. The opinions and views expressed in this commentary are solely those of Kristi Guse. Data used in writing this commentary obtained from various sources believed to be accurate. This commentary is intended for informational purposes only and is not intended for developing specific commodity trading strategies. Any and all risk involved with commodity trading should be determined before establishing a futures position. Please visit our Risk Disclosure Page for more information on commodity trading.

Weekend Review; Friday, January 18th, 2019

Weekly Review

To no surprise, China reported its December soybean imports at 60% of the previous year. It appears the Chinese have been successful at rationing protein demand during the trade war. China’s soybean crush is at the lowest rate since May of 2018, down over 5%. Poor hog prices and demand loss from African Swine Fever are the likely culprits. Currently the U.S. soy export program is running 440 million bushels behind the USDA forecast with ending stocks at 955 million currently.

China’s Agriculture Ministry recently stated they estimate that 916,000 pigs were culled after 100 cases of African Swine Fever have been reported since August 2018. This number seems to be extremely low given the large amount of commercial farms that broke out with ASF the last few months. The geographical footprint of ASF outbreaks is quite large in China, and some private analysts believe the cull numbers to be much higher. While this is a very large figure, in 2017 China slaughtered 700 million hogs for market. Many in trade are questioning the feed impact of the ASF to Chinese demand. The latest estimates have hog feeding is down 15-20%, which many believe this is largely understated, as new cases are discovered daily. A developing ethanol industry in China is helping offset some of the lost corn demand.

Speculation still surrounds the current trade situation with China. After the latest announcement stating they will be buying “substantial amounts of US products.” Most expecting purchases of U.S. soybeans but the economics also work for China to purchase U.S. corn. While nothing has transpired, some in trade speculate that 8 to 12 MMT could fit into China’s needs. If realized, that volume would help an already tightening US carryout. Rumors late in the week reported that US Treasury Secretary Steven Mnuchin discussed lifting some or all punitive tariffs imposed on China. Those were in fact just rumors, and no such discussion took place. Further trade discussions are expected between the U.S. and China on January 30th.

Weekly export inspections were at 1.013 MMT for corn, nearly double this time last year. Corn exports are currently running ahead the of the USDA’s projection for the year of 2.4 billion bushels. Soybeans were a bit better this week at 1.085 MMT. The weekly export inspections report is one of the few reports unaffected by the government shutdown now past the record 24 days. However, export sales news and the January supply and demand report that was scheduled for January 11th, is on hold indefinitely until the government day-to-day business resumes. The January report will post the final production estimate for 2018 by the USDA.

As we get closer and closer to March 1, acreage shift discussions continue to provide a mixed bag of numbers. For the soybean complex, even a large shift of 6 million acres away from soybeans does little to solve soybean carryout. That is assuming exports resume to pre Chinese trade war levels over 2 billion bushels. Acreage shift away from soybeans lends to thoughts that a significant amount of those acres will go to corn. As one would expect, increased acres add production and thus adds to corn carryout as well.

Ethanol production for the week ending on January 11th noticed an increase in total output. Production week over week saw an increase of 51,000 barrels of ethanol. This comes as ethanol producers see slightly better margins as we head in the last half of January. This would be the largest week over week over week increase since September. Total US ethanol stocks saw an increase of 97,000 barrels.

Soybean spreads continue to push wider and remain at extremely wide levels not seen in the last ten years. The cash market does not seem to have a sense of urgency even with the recent crop reductions in Brazil when you consider the size of the crop in relation to past records. More attention is focuses on incoming yield reports, as South American countries move closer to gut slot harvest.

Weather in South America, in particularly Brazil, remains volatile as is has been as the crop is in a critical period for moisture. Brazil has been garnering much of trade’s attention due to the lack of rainfall in much of the growing areas. Argentina is dealing with exactly the opposite situation. It is estimated that 60% of the growing belt has received over 150% of normal rainfall for the month of January and forecasts are indicating that more is on the way, likely setting a new monthly record. Soybean crop estimates in Brazil are down about 5% from initial estimates in November. However, the Western Hemisphere soybean supply is still much larger than the previous 5 years. U.S and South American supplies are nearly 140 million bushels larger than last year and 117 million bushels more than the previous year.

The National Oilseed Processors Association (NOPA) released their monthly crush number for December of 171.759 million bushels. This is the third highest level on record and the most ever for the final month of the year. This is well ahead of the 166.959 MB processed in November. Soy oil stocks were 1.498 billion pounds and Soymeal exports were 826,404 tons for the month.

For more information, you may contact Adam Suntken at (712)-454-1061, or e-mail at asuntken@maxyieldcooperative.com. The opinions and views expressed in this commentary are solely those of Adam Suntken. Data used in writing this commentary obtained from various sources believed to be accurate. This commentary is intended for informational purposes only and is not intended for developing specific commodity trading strategies. Any and all risk involved with commodity trading should be determined before establishing a futures position. Please visit our Risk Disclosure Page for more information on commodity trading.

Closing Comments; Thursday, January 17th, 2019

Reports earlier in the week stated France was going to cull all wild boars in a zone along the Belgian border, in hopes of preventing further outbreaks of African swine fever. The disease continues to spread into new provinces in China each week, if not daily.

U.S. State Department is calling furloughed employees back to work next week amid the government shutdown. Deputy Under Secretary of State Bill Todd stated, “it’s imperative that the Department of State carries out its mission and the best way to do so is with fully staffed embassies, consulates, and domestic offices.”

Currently the delivered prices for Brazilian soybeans to China have dropped around 14% over the last 4 days and is at the lowest level since July of 2018. Due to the better margins on Brazil’s soybeans, China has been buying a few more bean cargoes recently. Even with the news of China buying soybeans from Brazil, the markets found support from technical buying today.

March Corn ended the day up 6 cents at $3.80. March Soybeans finished up 13 cents at $9.07 . March Chicago Wheat closed up 5 cents at $5.17 .

For more information, you may contact Kristi Guse at (712)-260-6486, or e-mail at kguse@maxyieldgrain.com. The opinions and views expressed in this commentary are solely those of Kristi Guse. Data used in writing this commentary obtained from various sources believed to be accurate. This commentary is intended for informational purposes only and is not intended for developing specific commodity trading strategies. Any and all risk involved with commodity trading should be determined before establishing a futures position. Please visit our Risk Disclosure Page for more information on commodity trading.

Morning Comments; Thursday, January 17th, 2019

Corn and soybeans are trading higher this morning.

Speculation still surrounds the current trade situation with China. After the latest announcement stating they will be buying “substantial amounts of US products.” Most expecting purchases of US soybeans but the economics also work for China to purchase US corn. While nothing has transpired, some in trade speculate that 8 to 12 MMT could fit into China’s needs. If realized, that volume would help an already tightening US carryout. Leaders are set to meet again at the end of this month in Davos for further discussions.

China’s Agriculture Ministry recently stated they estimate that 916,000 pigs have been culled after 100 cases of African Swine Fever. While this is a very large figure, it was reported that in 2017, China slaughtered 700 million hogs for market.

While mostly unknown, the feed impact of the African Swine Fever to Chinese demand is being questioned by many in trade. The latest estimates have been hog feeding is down 15-20%, many believe this is largely understated, as new cases are discovered daily. A developing ethanol industry is helping offset some of the lost corn demand.

Market Movers: Brazil yield data, South American weather forecasts and fund activity.

Closing Comments; Wednesday, January 16th, 2019

US Secretary of Agriculture Sonny Perdue announced earlier today that FSA offices will be open temporarily as the government shutdown continues. FSA offices across the country will be open January 17th through January 22nd with normal business hours. The offices will be closed on Monday, January 21st to observe Dr. Martin Luther King, Jr. holiday. Staff will help farmers by processing payments and help producers with existing farm loans. Producers should have all documents in order that pertain to their own situation, as locations will be exceptionally busy during this timeframe.

Ethanol production for the week ending on January 11th noticed a decent pop in total output. Production week over week saw an increase of 51 thousand barrels of ethanol. This comes as ethanol producers see slightly better margins as we head in the last half of January. This would be the largest week over week over week increase since September. Total US ethanol stocks saw an increase in 97 thousand barrels.

March Corn finished 2 higher at $3.74. March Soybeans closed 1 cents higher at $8.94 . March Chicago wheat closed 1 cent higher at $5.12.

For more information, you may contact Brock Beadle at 515-341-7040, or e-mail at bbeadle@maxyieldgrain.com. The opinions and views expressed in this commentary are solely those of Brock Beadle. Data used in writing this commentary obtained from various sources believed to be accurate. This commentary is intended for informational purposes only and is not intended for developing specific commodity trading strategies. Any and all risk involved with commodity trading should be determined before establishing a futures position.

Closing Comments: Tuesday, January 15, 2019

Soybean futures were on the downward slide again today and pulled corn with it. Weak ethanol prices and lack of export sales news is weighing on the market along with forecasts for South America that are looking more and more mild with much needed rains expected in most parts of Brazil and drier weather expected for Argentina. Even the friendly NOPA crush report didn’t help to pull bean prices higher.

The National Oilseed Processors Association (NOPA) released their monthly crush number for December of 171.759 million bushels. This is the third highest level on record and the most ever for the final month of the year. This is well ahead of the 166.959 MB processed in November. Soy oil stocks were 1.498 billion pounds and Soymeal exports were 826,404 tons for the month.

March corn closed 7 cents lower at $3.71 , March soybeans closed 10 cents lower at $8.93 , and March wheat closed 3 cents lower at $5.11.

Morning Comments; Tuesday, January 15th, 2019

Grains are trading higher on the overnight session.

Export sales number might be absent during the government shutdown, but export inspection continue. Corn loadings for the week were nearly double this time last year at 39.8 million bushels. Corn exports are currently running ahead the of the USDA’s projection for the year of 2.4 billion bushels. No fresh news out of China regarding any new corn purchases.

Soybeans are losing steam as recent beneficial rains in South America has ease worries about a shrinking crop. To no surprise, China reported its December soybean imports at 60% of the previous year’s imports. It appears the Chinese have been successful at ration protein demand during the trade war. China’s soybean crush is at the lowest rate since May of 2018, down over 5%. Poor hog prices and demand loss from African Swine Fever are the likely culprits. Currently the U.S. soy export program is running 440 million bushels behind the USDA forecast with ending stocks at 955 million currently.

Market movers: Continued reaction to Chinese trade negotiations and weather forecasts.

For more information, you may contact Adam Suntken at (712)-454-1061, or e-mail at asuntken@maxyieldcooperative.com. The opinions and views expressed in this commentary are solely those of Adam Suntken. Data used in writing this commentary obtained from various sources believed to be accurate. This commentary is intended for informational purposes only and is not intended for developing specific commodity trading strategies. Any and all risk involved with commodity trading should be determined before establishing a futures position. Please visit our Risk Disclosure Page for more information on commodity trading.

Closing Comments: Monday, January 14, 2019

Rumors that China may have bought US DDGs pushed corn higher earlier today, but sympathy to the lower bean market has kept corn trading steady to slightly lower.

Weekly export inspections were good at 1.013 MMT for corn. Soybeans were a bit better this week at 1.085 MMT. The weekly Export Inspections Report is one of the few reports unaffected by the government shutdown now at a record 24 days.

Chinese trade data continues to disappoint. The bearish feelings on the Chinese economy are leading many to believe that Chinese imports will slow. Not to mention, US and China trade talks will not begin again for over 2 weeks that will take place in Washington DC.

Over the weekend rains fell across Northern Argentina and Southern Brazil. The forecast calls for more rain in those regions again this week, while the central and northern parts of Brazil are expected to stay dry.

March corn closed cent higher at $3.78 , March soybeans closed 6 cents lower at $9.03 , and March wheat closed 5 cents lower at $5.14 .

Morning Comments; Monday, January 14th, 2019

Grains are trading lower on the overnight session.

No news from the government continues to be the status quo. News on progress with Chinese trade negotiations has been limited but positive. A senior Chinese negotiator is on schedule to be in the U.S. later this month to continue working out a trade deal. However, export sales news and the January supply and demand report that was scheduled for January 11th, is on hold indefinitely until the government day-to-day business resumes. The January report will post the final production estimate for 2018 by the USDA.

Weather in South America, in particularly Brazil, remains volatile as is has been as the growing is in a critical period for moisture. Harvest has just begun in Brazil, but only 2% complete. Soybean crop estimates in Brazil are down about 5% from initial estimates in November. However, the Western Hemisphere soybean supply is still much larger than the previous 5 years. U.S and South American supplies are nearly 140 million bushels larger than last year and 117 million bushels more than the previous year.

As we get closer and closer to March 1, acreage shift discussions continue to provide a mixed bag of numbers. For the soybean complex, even a large shift of 6 million acres away from soybeans does little to solve soybean carryout. That is assuming exports resume to pre Chinese trade war levels over 2 million bushels. Acreage shift away from soybeans lends to thoughts that a significant amount of those acres will go to corn. As one would expect, increased acres add production and thus adds to corn carryout as well.

Market movers: Continued reaction to Chinese trade negotiations and weather forecasts.

For more information, you may contact Adam Suntken at (712)-454-1061, or e-mail at asuntken@maxyieldcooperative.com. The opinions and views expressed in this commentary are solely those of Adam Suntken. Data used in writing this commentary obtained from various sources believed to be accurate. This commentary is intended for informational purposes only and is not intended for developing specific commodity trading strategies. Any and all risk involved with commodity trading should be determined before establishing a futures position. Please visit our Risk Disclosure Page for more information on commodity trading.

Weekly Review; Friday, January 11th, 2019

South America Moves Closer to Soybean Harvest

The Commodity Weather Group recently updated their long-term forecasts. Their updates look promising for much of the growing areas in the US. Spring weather is forecasted to be drier and warmer for areas excluding the Southeast. Summer trends look warmer and drier in the Midwest into the Plains.

Soybean values had a large sell off on Thursday but are still getting support from a possible trade deal with China and adverse weather in Brazil. Better than expected rainfall fell in areas of Brazil recently but updated 10-14 day forecasts, show drier to much drier weather ahead. Parana, the largest state in Brazil, harvest is currently at 5% complete, where most years they have not started. Very little yield data has circulated for trade to work with, but all estimates are pointing lower to much lower. Conditions were reported at 58% good-to-excellent, down a large 22% from December.

Even with reduced yields from Brazil, world soybean carryout is expected to be record large. Leaving demand and US supplies steady, Brazil’s production would have to drop below 118 MMT to not be a record world supply. CONAB’s figures released yesterday were for 118.8 MMT.

A recent study from FC Stone looked at historical price increase of the March corn futures contract off the low established in the month of December. The average increase seen over the last 5 years has been 43 cents. The low established this December at $3.72 , which puts that target at $4.15 March futures. A historical look at the current stocks-to-use ratio of 11% and the current futures values also supports higher values.

Stretching the same data to 10 years showed that the average price increase was 74 cents. Over the 10-year period, the smallest increase off the low was 16 cents. Currently values are around 10 cents off the low. One very large factor that could affect these moves is the fact the funds are already holding a long position estimated at 125,000. Whereas past years have seen the fund position swing from short 200,000 to long 200,000, adding an massive amount buying power.

The acreage debate battle continues its center stage performance as the first week of the New Year is behind us. The countryside is filled with reports of higher fertilizer prices as farmers debate what crop should be designated to each acre. The poor showing of fertilizer applications this past fall lend credence to higher overall fertilizer prices this upcoming spring where demand may outstrip transportation capacity. Difficult decisions lay ahead as farmers will have to factor in spring working conditions and applying fertilizer, both in a timely matter.

Rumors have been circulating through trade of the possibility that China might be getting ready to remove tariffs on U.S. pork. This would be partly due to the concerns of the extent of how African swine fever is being under-reported in the country, especially since a dead pig was found earlier in the week on a Taiwanese beach. Reports state that China farmers are supposedly being paid $175 per culled pig, as an incentive program to report the disease.

Weekly ethanol production saw another decrease for the week ending January 4th. Last week saw a decrease in ethanol production by roughly 11 thousand barrels. The prior week saw an even larger decrease as ethanol grind continues to throttle back amidst poor margins. Despite all this, Iowa ethanol plants produced another record setting year for ethanol production. The Hawkeye state produced 4.35 billion gallons slightly higher than 2017, which came in at 4.2 billion gallons.

For more information, you may contact Brock Beadle at 515-341-7040, or e-mail at bbeadle@maxyieldgrain.com. The opinions and views expressed in this commentary are solely those of Brock Beadle. Data used in writing this commentary obtained from various sources believed to be accurate. This commentary is intended for informational purposes only and is not intended for developing specific commodity trading strategies. Any and all risk involved with commodity trading should be determined before establishing a futures position.

Morning Comments; Friday, January 11th, 2019

Corn and soybeans are higher on the overnight session

The Commodity Weather Group recently updated their long-term forecasts. Their updates look promising for much of the growing areas in the US. Spring weather is forecasted to be drier and warmer for areas excluding the Southeast. Summer trends look warmer and drier in the Midwest into the Plains.

Soybean values had a large sell off yesterday but are still getting support from a possible trade deal with China and adverse weather in Brazil. Better than expected rainfall fell in areas of Brazil recently but updated 10-14 day forecasts show drier to much drier weather ahead. Parana, the largest state in Brazil, harvest is currently at 5% complete, where most years they’ve not started. Very little yield data has circulated for trade to work with, but all estimates are pointing lower to much lower. Conditions were reported at 58% good-to-excellent, down a large 22% from December.

Even with reduced yields from Brazil, world soybean carryout is expected to be record large. Leaving demand and US supplies steady, Brazil’s production would have to drop below 118 MMT to not be a record world supply. CONAB’s figures released yesterday were for 118.8 MMT.

Ethanol data released Wednesday showed another weekly decrease in production. It now stands that 6 of the last 7 weeks corn grind for ethanol production has failed to reach the USDA’s estimates. Leading trade wondering if further reductions will be made to ethanol demand in future reports.

Market Movers; Fund activity, Trade negotiations and South American weather.

Morning Comments; Wednesday, January 9th, 2019

Trade talks continue

Yesterday, China gave the approval for 5 different genetically modified crops to be imported. Considering the heightened trade tensions between the two countries, many believe this to be a positive sign of trade conversations. Included in the approvals is the extension of other genetically modified crops for another 3 years. Many have argued that China’s stance on GM crops is not purely scientific but hold a political bias.

The dryness down in Brazil has garnered much of trade’s attention as of late. Rainfall amounts in some areas are at such an extreme that isolated areas are calling for a complete loss. Certain states in Brazil are seeing crop condition ratings worse than the previous 3 years for this timeframe. Reductions are likely to follow in upcoming reports.

Market Shakers: SAM Weather, Technical conditions

Closing comments: Tuesday, January 9, 2019

Grains are lower today with soybeans feeling the most pressure. Trade talks are going well between the US and China with another session in progress today. It is thought that China has bought 10-20 cargoes of soybeans from the US yesterday. Along with the shrinking Brazilian corn crop due to heat and dryness, there is plenty of positives news to push the market higher today, but it appears that there is some profit taking.

CONAB will be releasing updated Brazil crop estimates Thursday with first crop corn expected to come in lower due to dryness. The safrinha crop will probably not see any adjustment until the February report.

President Trump announced that he will be addressing the nation tonight at 8 PM concerning a “humanitarian and Security crisis on our Southern border.”

March corn closed 2 cents lower at $3.80, March soybeans are 5 cents lower at $9.18 , and March wheat is a penny higher at $5.17 .

Closing Comments: Friday, January 4, 2019

Dry weather in parts of Brazil and hopes for Chinese demand have pulled the grain market higher today. Rain is expected for parts of Brazil over the weekend, but dry weather remains in the forecast for next week. Production estimates are starting to be lowered for Brazilian soybeans on the dry weather concerns with a private estimate near 116 MMT with other estimates ranging from 117-119 MMT. The USDA was at 122 MMT in December.

Ethanol production for the week ending December 28th showed a decline of 31,000 barrels from the previous week, at 1.011 million barrels produced each day. Despite lower production, ethanol reserves grew by 29,000 barrels and stand 23.16 million barrels.

The USDA did announce this morning that due to the lack of federal funding the scheduled reports that were suspended on December 22nd will remain suspended. Given the amount of time it takes for analysis and compilation of the Crop Production, WASDE, Grain Stocks, Rice Stocks, Winter Wheat, and Canola Seeding Reports, those reports will not be released on January 11th even if funding is restored before that date.

March corn closed 3 cents higher at $3.83, March soybeans are 9 cents higher at $9.22 , and March wheat is 3 cents higher at $5.17.

Closing Comments: Thursday, January 3, 2019

The grain market spent most of the day higher as it appears that China has booked several cargoes of US soybeans. Improved trade relations with China are keeping traders hopeful that China will begin to buy US corn, DDG’s and ethanol if progress continues. However, the current government shutdown has any flash sale announcements delayed.

Once again there was no deal made that would end the government shutdown. President Trump and key Democrats are meeting again on Friday. Democrats take over the house today. USDA’s chief economist said that they will decide tomorrow if they will delay the crop report scheduled for January 11th.

March corn closed 4 cents higher at $3.79 , March soybeans closed 3 cents higher at $9.10 , and March wheat jumped 7 cents higher at $5.13 .

Morning Comments; Thursday, January 3rd, 2019

Corn and soybean are slightly lower in the overnight session

What producers plan to plant this coming spring continues to be debated by traders. Current soybean to corn ratio is around 2.36. Meaning it takes 2.36 bushels of corn at the current value to reach 1 bushel of soybeans at the current value. Analysts believe with higher input cost of corn, the ratio will need to be closer to 2.2 for farmers to plant corn over soybeans. If the price of corn remains steady, for that ratio to be seen, November soybean values would need to drop to $8.80 or roughly 60 cents below the current price.

Spot corn futures closed the year with gains of 24 cents, the first annual gain seen in the past 6 years. Ending stocks of corn are estimated 656 million bu less than last year at 1.781 billion bu. Front month soybean futures finished the year 70 cents lower. Soybean carryout is estimated a large 510 million bu higher than last year at 955 million bu.

As usual, speculation of what changes will be made on the final supply and demand numbers from the USDA are being discussed. A recent study by FC Stone showed that since the year 2000, there have been 7 years the corn yield has been reduced from the October to the November report, like this year. In 5 of those years, reductions from the November report into the January, final report were also made.

Market Movers: Chinese demand and South American weather.

Closing Comments; Wednesday, January 2nd, 2019

Today’s bean market was supported mainly by concerns of dryness in Brazil. Rumors that China is potentially back in the market for US soybeans added to the positive tone that markets saw today. Many analysts expect the dryness to reduce the soybean crop, but it is still very early to say how much risk premium the market can build. The drier growing conditions in Brazil has many believing that we could see the USDA decrease overall soybean production in the monthly reports that follow.

Bolsonaro was recently sworn in on Tuesday as the new president of Brazil, the largest country in South America. This breaks the four consecutive election cycles that have been held by left leaning presidents. The first order of business for the new President was an executive order to merge the Ministries of Agriculture and Environment. This could potentially allow new land to become available for commercial agricultural production.

January soybeans finished 12 cents higher at $8.49 . March corn closed cents higher at $3.75 . March Chicago wheat closed 5 cents higher at $5.08 .

For more information, you may contact Brock Beadle at 515-341-7040, or e-mail at bbeadle@maxyieldgrain.com. The opinions and views expressed in this commentary are solely those of Brock Beadle. Data used in writing this commentary obtained from various sources believed to be accurate. This commentary is intended for informational purposes only and is not intended for developing specific commodity trading strategies. Any and all risk involved with commodity trading should be determined before establishing a futures position.

Morning Comments; Wednesday, January 2nd, 2019

The board of trade did not trade last evening and will open at 8:30 a.m.

Grains remain in the quiet holding pattern as the calendar rolls into the New Year. Traders anxiously await progress on the U.S./Chinese trade negotiations expected to begin in the first weeks of the January. Until then, traders are reluctant to make a big move and in the reality of the soybean carryout has given the market plenty of headwind to fight.

Index fund traders will begin their “rolling” of positions as they begin the new calendar year. Funds will rebalance ownership based on past negative or potential positive performance. One commodity that has seen the most buying interest is soybean oil, since for the year prices are almost unchanged. Corn has been similar to soybean oil, finishing 24 cents higher than where it began 2018. Soybeans as one would expect, did not fare as well, closing over 70 cents lower for the year.

South American weather forecasts are neutral as rain in needed areas remains in the forecast for the near term.

Market movers: Continued reaction to Chinese trade negotiations and weather forecasts.

For more information, you may contact Adam Suntken at (712)-454-1061, or e-mail at asuntken@maxyieldcooperative.com. The opinions and views expressed in this commentary are solely those of Adam Suntken. Data used in writing this commentary obtained from various sources believed to be accurate. This commentary is intended for informational purposes only and is not intended for developing specific commodity trading strategies. Any and all risk involved with commodity trading should be determined before establishing a futures position. Please visit our Risk Disclosure Page for more information on commodity trading.

Closing Comments; Monday, December 31st, 2018

US soybean export inspections had another dismal week as they came in below trade estimates. Soybeans tallied 24.9 million bushels, which was well outside the trade range of 26 to 37 million bushels. Corn was in line trade estimates coming in at 36 million bushels. This was a 3.2 million bushel decrease from last week’s 39.2 million. In comparison to last year for this period, corn is ahead the USDA export forecast and soybeans are behind.

As year-end winds down, traders look to President Trump securing a new trade deal with China relatively soon. Over the weekend, President Trump tweeted that he had a long conversation with President Xi of China. Trump also noted that the conversation would cover all subjects, areas, and points of dispute.

January soybeans closed cents lower at $8.82 . March corn finished cent lower at $3.75. March Chicago wheat closed 8 cents lower at $5.03.

For more information, you may contact Brock Beadle at 515-341-7040, or e-mail at bbeadle@maxyieldgrain.com. The opinions and views expressed in this commentary are solely those of Brock Beadle. Data used in writing this commentary obtained from various sources believed to be accurate. This commentary is intended for informational purposes only and is not intended for developing specific commodity trading strategies. Any and all risk involved with commodity trading should be determined before establishing a futures position.

Morning Comments; Monday, December 31st, 2018

Grains are trading mixed on the overnight session.

Soybeans rebounded Friday on news that China, in what could be a good will gesture, will allow importing of US rice. Traders took this as a positive sign and a good start to resolving trade issues. The two countries are expected to begin negotiations in earnest the week of January 7th. China hopes to be able to make soybean supplies last until new crop Brazilian soybeans are in a shippable position in January. New crop beans are available at steep discounted to old crop Brazil soybeans and beans from the U.S. If China can stretch soy reserves, this gives them another 6 months to negotiate trade differences before soy demand puts them in a crunch.

The government shutdown continues and the lack of government reports continues keep the markets quiet. Despite the lack of export sales information, the possibility of a corn sale to China in January is waning. Even with a tighter balance sheet than last year, corn futures continue to act sluggish. Slumping crude oil prices and thoughts of a significant acreage switch from soy to corn appears to be keeping a lid on prices.

The Board of Trade closes at 1:15 p.m. today and will not resume trade until Wednesday, Jan 2nd at 8:30 a.m.

Market movers: Continued reaction to Chinese trade negotiations and weather forecasts.

For more information, you may contact Adam Suntken at (712)-454-1061, or e-mail at asuntken@maxyieldcooperative.com. The opinions and views expressed in this commentary are solely those of Adam Suntken. Data used in writing this commentary obtained from various sources believed to be accurate. This commentary is intended for informational purposes only and is not intended for developing specific commodity trading strategies. Any and all risk involved with commodity trading should be determined before establishing a futures position. Please visit our Risk Disclosure Page for more information on commodity trading.

Weekly Review; Friday, December 28th, 2018

Weekly Market Review

As expected, neither Republicans nor Democrats could reach an agreement leading to a partial government shutdown on Friday. The Senate voted down the latest spending bill that passed the House, which contained funding for the border wall. It is unknown how long this shutdown will last, as both sides seem unwilling to waiver. Services affected are the USDA website, weekly export sales reports, FSA offices will be closed after the first week of the shutdown, and payments will be issued once locations open back up once an agreement can be reached. The USDA would see 61% of it’s employees that would be exempted from the shutdown. There are a few reporting services that will not be affected from the shutdown such as weekly grain export inspections, and livestock price reporting.

Despite strong export loading inspections for corn, both corn and soybeans fell to one-month lows this week. Export destinations for corn came in higher than the week previous at 39.2 million bushels. The range of trade estimates was from the low side of 31 million bushels to 43 million bushels. Soybeans had another poor showing well outside the range of trade estimates. Last week’s inspections have soybeans at 23.9 million bushels with the trade estimate range from 29 to 44 million bushels. Last week’s poor showing in soybeans further highlights how far behind we are compared to the USDA’s forecast, as they have now crossed below the 100-day moving average. This also came after a 5% gain on the Dow Jones, the 9th largest one-day stock market move since the turn of the century on Jan 1, 2000. Export inspections will continue to go on despite the government shutdown, but export sales numbers will not be published until the normal day-to-day operation resumes.

News of more ethanol closures continue to circulate newswires. Some analysts believe the USDA will reduce ethanol demand in future reports. Others aren’t of the same opinion as the USDA made a 50 million bu. reduction in December and weekly EIA data has yet to show much for lower production. It is well known that margins are under pressure, it has been estimated that most plants have been operating in the red for the past 13 weeks.

Not only will market future values be affected by less ethanol demand but also basis values in many areas. A recent study by the firm Advance Trading Inc. stated that for every 100 million gallon ethanol plant that stops production, it is nearly equal to two unit trains of corn per week that is not being consumed in the regional supply line.

The Ukraine Ag Ministry recently updated their 2018 production estimates. Their figure is estimated at 35.5 MMT, which is million higher than the USDA. It is estimated that 90% of the crop is in good condition. Logistics have been reported to be a major problem.

Spring planting intentions are beginning to get some attention as analysts are looking at potential outcomes. Soybeans are the least attractive as it stands now with burdensome supplies. Current ending stocks on corn leads to thoughts of price potential, but if 4 million acres would switch from soybeans to corn, the oversupply issue will hamper both commodities. Moving acres from soybeans could potentially lower the soybean carryout to around 500 million, which is still more than adequate.

China continues to battle the African swine fever virus as it was found in some protein powders made using pork blood this week. There have been more than ninety cases of the highly contagious disease reported since August. Even with the disease continuing to spread, scientists in China have reported they have developed genetically modified pigs that are immune to the classical swine fever virus. Scientists have ran a trial on 55-day old pigs, and the genetically modified pigs saw some symptoms, but it was far less severe and non-fatal compared to the non-genetically modified pigs.

Weather models in South America show rain for the drier areas of Brazil in the forecast. This along with a lack of any fresh Chinese grain purchases also is pressuring the grain markets.

For more information, you may contact Kristi Guse at (712)-260-6486, or e-mail at kguse@maxyieldgrain.com. The opinions and views expressed in this commentary are solely those of Kristi Guse. Data used in writing this commentary obtained from various sources believed to be accurate. This commentary is intended for informational purposes only and is not intended for developing specific commodity trading strategies. Any and all risk involved with commodity trading should be determined before establishing a futures position. Please visit our Risk Disclosure Page for more information on commodity trading.

Closing Comments; Friday, December 28th, 2018

China continues to battle the African swine fever virus as it was found in some protein powders made using pork blood this week. There have been more than ninety cases of the highly contagious disease reported since August. Even with the disease continuing to spread, scientists in China have reported they have developed genetically modified pigs that are immune to the classic swine fever virus. Scientists have ran a trial on 55-day old pigs, and the genetically modified pigs saw some symptoms, but it was far less severe and non-fatal compared to the non-genetically modified pigs.

The markets had some technical short covering today, especially on the soybeans causing the spark in the markets. The potential trade news between the U.S. and China of a scheduled meeting during the week of January 7th, has also helped the markets today. There continues to be news that China may already be importing U.S. ethanol by way of purchases through Indonesia, similar to how China is importing soymeal from Argentina and Argentina imports soybeans from the U.S. It’s still expected that China will buy U.S. corn, pork, and other ag products after the first of the year.

March Corn ended the day up a penny at $3.75 . January Soybeans finished up 13 cents at $8.82 . March Chicago Wheat closed up a penny at $5.11 .

For more information, you may contact Kristi Guse at (712)-260-6486, or e-mail at kguse@maxyieldgrain.com. The opinions and views expressed in this commentary are solely those of Kristi Guse. Data used in writing this commentary obtained from various sources believed to be accurate. This commentary is intended for informational purposes only and is not intended for developing specific commodity trading strategies. Any and all risk involved with commodity trading should be determined before establishing a futures position. Please visit our Risk Disclosure Page for more information on commodity trading.

Morning Comments; Friday, December 28th, 2018

Grains are trading higher on the overnight session.

Slow, quiet trade moving in the end of the year continues. With export sales information on hold with the government shut down, there will be little if any news on fresh export business to China. Rumors in the trade indicate that both the US and China intent to begin trade negotiations the week of January 7th. Better weather forecasts for Brazil continues to keep soybean prices less than volatile.

African Swine Flu (ASF) and soybean tariffs continue to influence Chinese feed rations. There is chatter in the market that the Chinese will begin to reduce protein levels in rations to reduce soybean meal demand by as much as 25 million metric tons. Higher corn prices pushed the use of meal, but as corn prices have softened slightly, it makes meal less economical. The true impact of ASF on feed demand continues to unfold and is still largely unknown.

Market movers: Continued reaction to Chinese trade negotiations and weather forecasts.

For more information, you may contact Adam Suntken at (712)-454-1061, or e-mail at asuntken@maxyieldcooperative.com. The opinions and views expressed in this commentary are solely those of Adam Suntken. Data used in writing this commentary obtained from various sources believed to be accurate. This commentary is intended for informational purposes only and is not intended for developing specific commodity trading strategies. Any and all risk involved with commodity trading should be determined before establishing a futures position. Please visit our Risk Disclosure Page for more information on commodity trading.

Closing Comments: Thursday, December 27, 2018

The weekly USDA Export Inspections Report showed corn shipments of 996,098 MT during the week of 12/20. This is 60.45% more than the same week a year ago. Soybeans had a disappointing report with just 651,181 MT of soybeans shipped with only 367 MT going to China. The weekly Export Sales Report will probably not be updated on Friday with employees on furlough due to the government shutdown.

US trade team will travel to Beijing the week of January 7th to hold trade talks with Chinese officials. In the meantime consultations via the phone regarding trade will continue until the face to face meeting.

As the partial government shutdown continues into its 6th day, Congress will return today, but no votes are expected on any spending measures.

March corn closed 1 cents higher at $3.74 , January soybeans are a penny lower at $8.69, and March wheat is a cent higher at $5.10 .

Morning Comments; Thursday, December 27th, 2018

Grains are trading higher on the overnight session.

Despite strong export loading inspections for corn, both corn and soybeans fell to one-month lows yesterday. Soybeans have now crossed below the 100-day moving average. This also came after a 5% gain on the Dow Jones, the 9th largest one-day stock market move since the turn of the century on Jan 1, 2000. Export inspections will continue to go on despite the government shutdown, but export sales numbers will not be published until the normal day-to-day operation resumes.

Spring planting intentions are beginning to get some attention as analysts are looking at potential outcomes. Soybeans are the least attractive as it stands now with burdensome supplies. Current ending stocks on corn leads to thoughts of price potential, but if 4 million acres would switch from soybeans to corn, the oversupply issue will hamper both commodities. Moving acres from soybeans could potentially lower the soybean carryout to around 500 million, which is still more than adequate.

Weather models in South America show rain for the drier areas of Brazil in the forecast. This along with a lack of any fresh Chinese grain purchases also is pressuring the grain markets.

Market movers: Continued reaction to Chinese trade negotiations and export business.

For more information, you may contact Adam Suntken at (712)-454-1061, or e-mail at asuntken@maxyieldcooperative.com. The opinions and views expressed in this commentary are solely those of Adam Suntken. Data used in writing this commentary obtained from various sources believed to be accurate. This commentary is intended for informational purposes only and is not intended for developing specific commodity trading strategies. Any and all risk involved with commodity trading should be determined before establishing a futures position. Please visit our Risk Disclosure Page for more information on commodity trading.

Closing Comments; Wednesday, December 26th, 2018

Export destinations for corn came in higher than the week previous at 39.2 million bushels. The range of trade estimates was from the low side of 31 million bushels to 43 million bushels. Soybeans had another poor showing well outside the range of trade estimates. Last week’s inspections have soybeans at 23.9 million bushels with the trade estimate range from 29 to 44 million bushels. Last weeks poor showing in soybeans further highlights how far behind we are compared to the USDA’s forecast.

The federal government has entered its fifth day of being shut down. The USDA would will see 61% of it’s employees would be exempted from the shutdown. FSA offices will be closed after the first week of the shutdown, and payments will be issued once locations open back up. There are a few reporting services that will not be affected from the shutdown such as weekly grain export inspections, and livestock price reporting.

January soybeans finished 14 cents lower at $8.70. March Corn closed 4 cents lower at $3.73 . March Chicago wheat closed 6 cents lower at $5.10 .

For more information, you may contact Brock Beadle at 515-341-7040, or e-mail at bbeadle@maxyieldgrain.com. The opinions and views expressed in this commentary are solely those of Brock Beadle. Data used in writing this commentary obtained from various sources believed to be accurate. This commentary is intended for informational purposes only and is not intended for developing specific commodity trading strategies. Any and all risk involved with commodity trading should be determined before establishing a futures position.

Morning Comments; Wednesday, December 26th, 2018

The Ukraine Ag Ministry recently updated their 2018 production estimates. Their figure is estimated at 35.5 MMT, which is million higher than the USDA. It is estimated that 90% of the crop is in good condition. Logistics have been reported to be a major problem.

News of more ethanol closures continue to circulate newswires. Some analysts believe the USDA will reduce ethanol demand in future reports. Others aren’t of the same opinion as the USDA made a 50 million bu. reduction in December and weekly EIA data has yet to show much for lower production. It is well known that margins are under pressure, it has been estimated that most plants have been operating in the red for the past 13 weeks.

Not only will futures values be affected by less ethanol demand but also basis values in many areas. A recent study by the firm Advance Trading Inc. stated that for every 100 million gallon ethanol plant that stops production, it is nearly equal to 2 unit trains of corn per week that is not being consumed in the regional supply line.

Market Movers: Fund activity and export demand.

Morning Comments; Monday, December 24th, 2018

Corn and soybeans are both under pressure in the overnight session.

As expected, neither Republicans nor Democrats could reach an agreement leading to a partial government shutdown on Friday. The Senate voted down the latest spending bill that passed the House, which contained funding for the border wall. It is unknown how long this shutdown will last as both sides seem unwilling to waiver. Services affected are the USDA website, weekly export sales reports, FSA offices and payment processing will cease until an agreement can be reached. Weekly inspections, SNAP benefits, mandatory livestock price reporting as well as vital FDA activity will continue as usual.

Last Thursday, saw the March corn contract drop below the December $3.80 low established on December 6th. Last year the December low was put in on the 19th at $3.46 and dropped to $3.45 in January before rallying 49 cents. The last 4 years have seen March corn futures rally by an average of 43 cents off the December low.

Reminder trade will close at 12:05 today for Christmas.

Market Movers: Year-end positioning, technical trade and export demand.

Closing Comments; Friday, December 21st, 2018

Corn and beans were pressured on both sides of today’s action. Much of today’s activity was positioning for the long holiday weekend with month end and year-end coming next week. Commodity funds have spent the last few sessions getting into position for the usual thin holiday trade. Markets and banks will be open until 12 PM central on Monday and resuming trade for the day session next Wednesday, December 26th.

A developing concern that trade is taking a closer look at is the lack of precipitation Brazil has experienced over the past few weeks. This dry period has seemed to take place over just three weeks with rain easing drought concerns over the past few days. Stressed crops in certain areas can visibly be seen in corn and soybeans. The question remains to what extent the potential yield loss has accrued.

March corn closed 3 cents higher at $3.78 . January soybeans finished 8 cents lower at $8.84 . March Chicago wheat closed 10 cents lower at $5.13 .

For more information, you may contact Brock Beadle at 515-341-7040, or e-mail at bbeadle@maxyieldgrain.com. The opinions and views expressed in this commentary are solely those of Brock Beadle. Data used in writing this commentary obtained from various sources believed to be accurate. This commentary is intended for informational purposes only and is not intended for developing specific commodity trading strategies. Any and all risk involved with commodity trading should be determined before establishing a futures position.

Weekly Market Review; Friday, December 21st, 2018

Weekly Market Review

The USDA announced a second round of Market Facilitation Payments this week with the following payments; corn at 1 cent per bushel and $1.65 a bushel for beans on the remaining 50% of production. Producers have until January 15th to apply if they have not already done so but have until May 1, 2019 to prove production.

Export inspections for the week ending December 13th, stayed consistent with the previous week’s levels on corn coming in at 34.8 million bushels. It was up slightly from last week by 345,000 bushels. Soybean loadings were at 35.8 million bushels, up 1.7 million bushels from the previous week. Wheat inspections were at 25 million bushels, up 8.5 million bushels from a week ago. Export sales for the same period were 77.7 million bushels for corn, 104.2 million bushels for soybeans and 11.5 million bushels for wheat. Mexico and Japan continue to be the big takers for corn and China purchased 54.7 million bushels of old crop soybeans.

The corn and soybean trade continues to lug forward hoping for more export sale announcements made to China. The rumor of a 3 million metric ton corn sale last week has traders expecting some purchase activity to happen in early January, but nothing has been official at this time. Corn export inspections are running 6% ahead of what’s need to meet the USDA projection. The soybean market has been under slight pressure as traders are becoming more aware that supplies are still abundant despite China returning to the US export market. Wednesday, the USDA confirmed a 44 million bu. sale to China, bringing the estimated monthly total up to roughly 136 million bu. Discussions continue to circulate of the possibility of another 5 to 6 MMT, which if realized would still leave the export figure below the USDA’s forecast.

Many traders and analysts have been discussing the strong likelihood that the USDA has overestimated soybean export demand, and many are wondering why futures values remain as solid as they have. Some believe the recent developments with China have led to hopes of larger unforeseen purchases to come and the technical structure have kept values supported.

There has been talk that China could soon approve their reserve group to buy U.S. beef, pork, corn, sorghum, ethanol and DDGS, but not until after the first of the year. The markets will continue to watch and see if China is going to keep buying U.S. soybeans and if possible future purchases of other agricultural goods, all of which has been offering some support to the markets.

South American weather is lending a little support to the soy complex as some heat and dryness is in the forecast for central Brazil and excessive moisture for regions in northern Argentina. It is still early in the growing season but as the first maturing beans in Brazil become ready for harvest in January, soil moisture going forward is more critical. Brazil weather is overall favorable but the fact that certain growing areas have seen only 50-75% of average rainfall over the last 60 days, has kept risk premium in the soybean market. Precipitation is in the forecast for many of the dry areas, as it has been in recent weeks while very little actually developed.

More new cases of African Swine Fever continue to be reported in China giving little indication that the spread is under control. Since the disease continues to spread, its creating tight pork supplies especially since farmers are not willing or able to repopulate their herds. Pork prices are expected to rise and China will likely buy significant amounts of pork on the world market, due to the tight supplies, especially since the high demand period of the Chinese New Year is coming up. The disease has cut China’s weekly soybean crush pace by 15% in the past month from the pace of last year. It is at the lowest level reported in the past 4 years. USDA is estimating an average reduction of only 4%.\

November NOPA crush numbers released Monday were almost 1.5 million bushels below the average trade estimate at 167 million bushels, down 5.3 million bushels from October. While crush for November was disappointing the total crush since September 1 is more than 35 million bushels ahead of last year’s pace.

The weekly ethanol report showed steady production at 1.046 million barrels per day, and stocks up nearly a million barrels at 23.873 million barrels, the largest since mid-October despite recent plant shutdowns. Poor margins are the key reason to the steady production numbers as more plants are slowing down.

For more information, you may contact Adam Suntken at (712)-454-1061, or e-mail at asuntken@maxyieldcooperative.com. The opinions and views expressed in this commentary are solely those of Adam Suntken. Data used in writing this commentary obtained from various sources believed to be accurate. This commentary is intended for informational purposes only and is not intended for developing specific commodity trading strategies. Any and all risk involved with commodity trading should be determined before establishing a futures position. Please visit our Risk Disclosure Page for more information on commodity trading.