Corn Rally Extends on China Demand Hopes
Corn for May delivery rose 1.5% to $3.81 1/4 a bushel on the Chicago Board of Trade on Tuesday, with Chinese buyers reportedly interested in purchasing certain U.S. agricultural goods, including corn and ethanol.
Wheat for May delivery rose 0.8% to $5.27 1/4 a bushel.
Soybeans for May delivery rose 0.3% to $9.03 1/2 a bushel.
Farmer Sentiment Index Up on Optimism About Current Conditions -- Market Talk
14:35 ET - The Purdue University/CME Group Ag Economy Barometer hit record highs on producers' perception of improved current conditions in the agricultural economy. The barometer hit 168 in February, up one point from January and up 18 points since December. The Index of Current Conditions rose 12 points from January to 154. The Index of Future Expectations fell 4 points below the record high set in January to 175. "Almost across the board, producers indicated they were more optimistic about current conditions on their farms and in U.S. agriculture and retained most of the improvement in future expectations exhibited in January," says James Mintert, director of Purdue's Center for Commercial Agriculture. "Optimism about the agricultural trade outlook was underpinned by recent trade agreements and appeared to be the primary driver behind the improvement in sentiment." (firstname.lastname@example.org)
Plant-Based Meat Makers Compete on Price -- Update
Makers of plant-based meat alternatives are cutting prices, as startups compete with food-industry giants for slices of the rapidly growing market.
Impossible Foods Inc. said Tuesday that it had reduced wholesale prices for its products by 15%. Big food companies -- including Nestle SA, Smithfield Foods Inc., Cargill Inc. and food distributor Sysco Corp. -- have recently set plans to introduce their own meat-free patties, sometimes at lower prices than those charged by startups, like Impossible, that helped popularize plant-based products.
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Grains Up On Reports of Chinese Interest -- Market Talk
14:24 ET - Scattered media reports that Chinese buyers are looking into purchasing US corn, ethanol, spring wheat, and sorghum helped pace grain futures higher. However, traders and analysts say that it's not clear if a large Chinese purchase is around the corner. "Several US exporters tell [AgResource] that their phone has not buzzed from China for weeks, but they are hopeful that China will be calling following the start of issuing of duty exempt import licenses in coming days," AgResource says. Corn futures are leading CBOT grains up 1.3% Tuesday, while wheat is up 0.5% and soybeans are virtually unchanged. (email@example.com; @kirkmaltais)
Wheat Futures Rise Off of Near-Term Bottom -- Market Talk
10:56 ET - Wheat futures appear to have found a bottom and are rising off of it. The May contract is up 2.1% to roughly $5.34 a bushel. "Chicago wheat dropped four days in a row, so bottom picking," says Terry Reilly of Futures International. Reports of South Korean interest in US wheat are also fueling the rise, Reilly says, and corn's uptick is pulling wheat along with it. Meanwhile, corn is up 2.2% and soybeans are up 0.6%. (firstname.lastname@example.org; @kirkmaltais)
Sustainable Agriculture Efforts Will Need Government Backing -- Market Talk
15:53 ET - Efforts by companies in the agricultural sector to create sustainable solutions will need the support of governments, S&P Global Ratings says. Breakthroughs on issues such as greenhouse gas emissions, soil preservation and biodiversity are "unlikely without direct government involvement," the ratings agency says in an article. Multinational companies in the agricultural chemicals and consumer business industries will need "an integrated sustainability strategy to retain their current quality of earnings over the next five to 10 years," adds S&P. It also emphasizes that for such strategies to work "governments worldwide need to take decisive action." Private money already being invested in sustainable agriculture will "be of immediate benefit to certain consumer goods segments in developed markets, and provide policymakers with a wider range of workable solutions," S&P said. (email@example.com)
South Africa Agriculture Rebounds; Virus Could Curb Earnings -- Market Talk
1656 GMT - Favorable rains have triggered farmland expansions across South Africa, aiding the recovery of a sector that has contracted for two years in row, but the continuing spread of coronavirus could hurt Africa's most advanced economy, says Wandile Sihlobo, chief economist at the Agricultural Business Chamber. Government data indicates that South Africa's 2019-20 summer crops production will likely jump 26% on year to nearly 17M metric tons, which could be the second-largest summer-crop harvest on record after the 2016-17 crop. "We are convinced that South Africa's farm economy could recover by at least 5% y/y in 2020," Sihlobo says, adding that spreading coronavirus "could negatively impact the global demand for agriculture products, and subsequently prices." (firstname.lastname@example.org; @Nicholasbariyo)
Beyond Meat Jumps as Rival Cuts Prices -- Market Talk
1047 ET - Beyond Meat shares gain even as rival plant-based meat alternative maker Impossible Foods announces it's cutting prices by 15%, while the fast-growing food niche gets more crowded. Beyond says it's resisted broadly discounting its pea protein-based burgers and sausages, and has kept signing up new restaurant clients like Starbucks and KFC. Impossible last week said its burger was named the preferred plant-based burger of Disney's parks and cruise ships. Beyond Meat shares recently 4.7% higher. (email@example.com; @jacobbunge)
Cattle Finishes Down After Monday Rally, Hogs Inch Higher -- Market Talk
15:42 ET - Cattle futures on the CME end lower, down 0.1% at $1.101 per pound. This after the futures contract traded up by as much as 2.5 cents per pound more than Monday's close. Meanwhile, hog futures continue to recover after dropping to nearly 62 cents per pound last week. Today's 1.2% uptick puts the April hog contract at 63.55 cents per pound. However, whether or not hogs will rally more this week remains unclear. "This week's harvest is once again projected to come in 5% higher than last year and record large," says Dennis Smith of Archer Financial Services. "If numbers don't drop off, a meaningful upward move in hogs will never materialize--too bad because exports and demand in general have never been better." (firstname.lastname@example.org; @kirkmaltais)