Grain News: May 9, 2019 – US/PRC Trade Negotiations Resume Tonight
Grains have started out lower on poor export sales and rising Chinese tensions.
For the week, soybean sales saw a net cancellation of 149k tonnes (5.5 million bushels) vs the market expectation of sales at 300-650k tonnes. Corn also printed a marketing year low, well below expectations at 91k tonnes (3.3 million bushels). CONAB continues to raise production estimations, up 0.5 mmt for the Brazilian soybean crop to 114.3 MMT from the 113.8 MMT of last year.
Overnight, President Trump is saying China “broke the deal” while China is preparing a list of U.S. products that will face retaliatory tariffs if the U.S. moves ahead. U.S./PRC trade negotiations will resume this evening between Lighthizer and PRC Vice Chairman in Washington.
Tomorrow is the May WASDA report at 11am. This is the first USDA report to project the new crop year supply and demand data. It is the first 19/20 balance sheet and first objective winter wheat crop production estimates.
With all the headlines, locally weather is of most concern as we pass the specific May 10th date where it is said to start to impact yields each day corn is not yet planted. As the forecast continues to not give an easy window for planting the question that the trade continues to seek is what will trigger a fundamental shift in the large short fund position.