In this file:
· Don't Expect Every Question Answered by USDA's August Report
· U.S.-China trade war boosts Brazil local soy prices, spurs deals
Don't Expect Every Question Answered by USDA's August Report
by Clinton Griffiths, AgWeb
Aug 06, 2019
Grain markets settling down Tuesday following turbulence to start the week after what seems like an escalation in the trade war with China. Corn futures at the CME Group in Chicago have seen a steady march lower since last month.
In an interview on AgDay TV with Clinton Griffiths, Mark Gold of Top Third Ag Marketing says the issue is that the weather just hasn't been that bad since the rains slowed down in late June.
"We know that the pollination is way late," says Gold. "We haven't had a whole lot of rain these last seven days, we're not going to get a whole lot in the next seven days but it's been enough."
While there are spotty issues with dryness and heat, Gold says temperatures haven't been overly hot.
"There's not a whole lot of stress out there," says Gold. "The big question is on the supply side and what are the acres?"
Gold thinks ultimately both yields and acres will trend lower in USDA's subsequent reports.
"I don't think the USDA is going to see a huge reduction in the acres from the last report, mainly because they're going to be including all those acres for silage," says Gold. "One of the secretaries came out and said corn planted is corn planted and that means they're just going to lump it all together."
Gold doesn't think the industry will get every answer they want in the August report. Regardless, he's expecting the market to react to the updated information.
"If the report is friendly, then obviously we can move a lot higher," says Gold. "If they don't really make any changes in the numbers, the yield is still 165 or 166, we're going lower and maybe significantly lower."
Gold says the biggest issue he sees on the horizon is softening demand given the trade issues facing the industry.
"We've got to offset that," says Gold...
more, including video report [2:11 min.]
U.S.-China trade war boosts Brazil local soy prices, spurs deals
Roberto Samora & Ana Mano, Reuters
August 7, 2019
SAO PAULO (Reuters) - The price of Brazilian soybeans in local currency reached the highest level in almost two months, driven by a spike in port premiums for soybeans and a weaker currency, both caused by the trade dispute between China and the United States.
Prices in Sorriso, at the heart of Brazil’s soy country in the state of Mato Grosso, closed at 62.31 reais ($15.67) per bag on Tuesday, 0.81% above the previous day and the highest level since June 18, according to price research center Cepea/Esalq.
Brazil’s port premiums at Paranaguá rose to $1.35 over Chicago futures on Tuesday after the United States escalated the war against China, the world’s largest soy importer, which responded by halting all deals for U.S. farm products.
Brazil port premiums have soared 70% from June 16, Refinitiv data shows, reaching the highest level since November 2018.
Camilo Motter, a grain broker in Paraná state, said that the combination of a weak Brazilian real and high port premiums were boosting values for soybeans in the domestic market, when considering reais per 60-kg bags.
The Brazilian currency fell almost 5% against the dollar this month to almost four to the greenback on Wednesday BRBY.
Lucílio Alves, a grains analyst with Cepea/Esalq, said Chinese demand is likely to rise. “After the escalation of the trade war, they will probably focus on Brazil and even cancel U.S. soybean purchases,” he said.
Brazilian farmers are taking the opportunity to sell old crop soy and also to clinch some deals to sell next year’s crop that they will start to plant next month, according to producers association Aprosoja.
“The producer waits for moments like this,” said Bartolomeu Braz Pereira, head of Aprosoja...