- Chicago values are tentatively higher at midday on the hope that an end game in US/China trade negotiations is near. The volume of trade as active on the opening but has slid to modest levels at midday. We look for a firm close as traders and producers await US/China trade deal news later today. Media reports are offering differing views on whether a 3:30 pm (CST) Oval Office meeting between US President Trump and Vice Premier Liu He will announce a signing summit between President Trump and Chinese President Xi later this month. Several media reports have suggested that a signing summit will be announced, while others said that it will occur at future date as a few details (of the deal) are still being ironed out. President Trump just said that the deal is moving along nicely and that it will be a wonderful deal for US farmers. The uncertainty of whether the US/China deal is done/completed or that negotiation is ongoing has produced uncertainty in morning Chicago trade. Yet, the bottom line is that US/China trade negotiations are nearing completion, and it is expected that a deal will be reached in coming days.
- Chicago brokers report that funds have bought 3,000 contracts of corn and 2,500 contracts of soybeans, while being flat in wheat. In soy products, funds are flat in soymeal while buying 3,200 contracts of soyoil.
- President Trump reduced the pressure on US ag product exports into Mexico by offering a plan; “If Mexico does not aid in the prevention of illegal aliens into the US over the next year, he will tariff autos”. President Trump suggested that this would tariff up to $500 billion annually in autos and that would be a huge incentive for Mexico to help in the US illegal alien effort. The likelihood for the closure of the US border to ag trade has been diminished by President Trump’s midday comment on Mexico.
- For the week ending March 28, the US sold 25.9 million bu of wheat, 21.2 million bu of corn, and 72.4 million bu of soybeans. The soybean sales were expected, but US wheat demand was larger than anticipated. For their respective crop year to date, the US has sold 894 million bu of wheat (up 52 million or 6%),1,700 million bu of corn (down 164 million or 8.8%), and 1,603 million bu of soybeans (down 289 million or 15%). Pace analysis on US corn/soybeans exports suggests that WASDE may trim their 2018/19 annual export estimates. However, they may wait to make any reductions if a US/China trade pact is announced before next Tuesday. China appears to be pledging to make sizeable initial purchases should an agreement be achieved. WASDE will not want to cut estimates next week and reverse that trend in May.
- The midday GFS weather forecast is slightly drier for the W and Central Midwest. Rain totals have been reduced to 0.75-2.50”, down about 0.25-0.50” from the overnight run. The forecast offers 1-3.50” for the Delta and much of the Gulf Coast States. The abundant rainfall will maintain saturated soils and keep flooding concern in the forefront for the Lower Mississippi River. This is an active and wet weather pattern into the third week of April. Snows are shifted west into IA by the midday GFS forecast around April 10. The cold and wet weather looks to pose problems in early corn seeding. Warmth will occur for the next week followed by cool to cold temperatures into April 21.
- The Vice Premier of China and US President Trump will be meeting at 3:30 pm (CDT) in the Oval Office. Media reports offer differing solutions of whether (or not) a signing summit will occur. Yet, the odds are high that a deal will be completed, it is just a question of timing and working out the final details. Saturated soils and cool/wet forecasts will delay Midwest corn seeding. This is no place to make Chicago sales in our opinion as the market awaits news on whether a US/ China signing summit can be announced. Corn should be the upside leader.