Wheat for December delivery fell 1.6% to $5.09 a bushel on the Chicago Board of Trade on Wednesday, after prices spiked on cold weather concerns in the previous session. Corn for December delivery fell 0.7% to $3.75 1/4 a bushel. Soybeans for January delivery fell 0.2% to $9.15 1/4 a bushel.
Crop conditions were marked down to only 54% of winter wheat being in either good or excellent condition versus 57% last week, the USDA said Tuesday afternoon. The markdown takes into account a blizzard last month that hit wheat-growing areas in the northern plains, which buried wheat in an early snow. However, this wasn't enough to boost wheat prices. "Yesterday's rally was a 'greasefire', flaring up for little reason, other than the cold and snow over the [soft-red wheat] areas," Charlie Sernatinger of ED&F Man Capital said.
U.S.-China Trade Talks Hit Snag Over Farm Purchases
Trade talks between the U.S. and China have hit a snag over farm purchases, according to people familiar with the matter, creating another obstacle as Beijing and Washington try to lock down the limited trade deal President Trump outlined last month.
Mr. Trump has said China has agreed to buy up to $50 billion in U.S. soybeans, pork and other agricultural products annually. But China is leery of putting a numerical commitment in the text of a potential agreement, according to the people.
ADM: Ethanol Business Is Terrible, 2020 Can't Get Much Worse -- Market Talk
10:50 ET - Archer Daniels Midland CFO Ray Young describes the ethanol business this year as terrible, but the corn producer figures 2020 can't get much worse. Young tells an investor conference that much of the US ethanol industry, which includes ADM as a top player, has been running at breakeven rates this year, though Iowa State University's model of a typical Iowa ethanol plant shows per-gallon losses for over a year as of September. Young says a "phase one" trade deal with China, which he expects soon, will boost ethanol export demand. In the meantime, ADM's working to separate part of its ethanol business into an independent entity. (firstname.lastname@example.org; @jacobbunge)
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Trump Impeachment Hearings Could Move Grain Markets -- Market Talk
10:10 ET - Like other US markets, grain traders are keeping an eye on any developments to come out of the first public hearings in the House of Representatives over the impeachment of President Trump, and may move depending on how damning any testimony given is. "The Chinese will certainly be paying close attention, as anything that can weaken President Trump strengthens the Chinese position at the negotiating table," says Jeff Kaprelian of the Hueber Report. However, pressure on Trump could cause a deal to materialize sooner, says Craig Turner of Daniels Trading. "If the economy is at the center of his reelection campaign, then he can't look weak on trade," says Turner. Grain futures on the CBOT began Wednesday trading lower. (email@example.com, @kirkmaltais)
Brazil Corn Production Likely to Grow in Northeast -- Market Talk
0743 ET - Brazil's corn production is likely to grow rapidly in the area consisting of the states of Sergipe and Alagoas and the northeastern region of the state of Bahia, according to Brazilian crop agency Conab. The grouping of states, also known as Sealba, plants corn during the same calendar period as the northern hemisphere and is forecast to grow 1.16 million metric tons of the crop in the 2019-2020 season. Conab on Wednesday forecast a total corn crop of 98.37 million tons for the season, a decline from the 100.05 million tons produced in 2018-2019. (firstname.lastname@example.org)
Livestock Futures Take a Tumble -- Market Talk
15:42 ET - Livestock futures on the CME slide, with lean hog futures declining 2.5% to 63.125 cents a pound and live cattle futures falling 1.4% to $1.1810. For hog futures, today's decline follows the movement of cutouts earlier today, which generally posted a fall led by pork butt--which lost $2.26 per hundredweight to slide to $86.63. News broke late in the trading day that trade talks between the US and China hit a snag over farm purchases, also a bearish indicator for hog futures. Meanwhile, cattle futures continue to relax after briefly breaking $1.20 a pound this month. (email@example.com; @kirkmaltais)