Headlines:
- Chemicals and seeds producer DuPont indicated on Tuesday that its $130-billion merger with Dow Chemical Co will take longer to wrap up than previously expected as the companies await regulatory approvals.
- Threats to US ag trade with China, Mexico ‘far bigger deal’ than TPP’s loss
Threats to US trade with China or Mexico, which have been raised by Donald Trump’s US presidency, look far more serious than the loss of the TPP deal, a senior CME Group executive said, foreseeing a jump in ag price volatility. Erik Norland, executive director and senior economist of CME Group, downplayed President Trump’s decision on Monday to withdraw the US from the TPP, the Trans-Pacific Partnership free trade deal, saying that “I do not think it really changes very much”. The TPP, even if Mr. Trump had not intervened, “lacked support to get through Congress”, Mr. Norland told investors. While the deal held out the potential for opening up “some opportunities to US farmers to export more” to other nations signed up to TPP… “the good news for US farmers is that it does not change the status quo because the agreement had not been ratified in any case”.
Summary:
The Presidential Inauguration was 4 days ago and there is still no date set for the President’s nominee for Agriculture Secretary. The Senate Ag Committee is still collecting background information on Sonny Perdue prior to setting a date for a confirmation hearing. In the meantime, an adviser in Trump’s campaign from Iowa has been named as a liaison to help fill other political appointments at the USDA, a move that is welcomed by the Ag community.
The markets were mostly lower today as would be expected given the run that we have had the past several days. Nearby Corn and Wheat were down 6 and 6.75 cents respectively, while Soybean was able to recover its losses and finish up 1 cent. The daily Soybean chart is forming a flag formation with a series of lower highs and lower lows over the past couple of days. The close in Beans today was above support which we have at 1053. If nearby Beans close above that level, this week look for continued strength. Producers continued selling into the strength Corn and Wheat today which were also at key price resistance.
The USDA announced export sales of US Corn and Soybeans today.
- Export sales of 163,000 metric tons of soybeans for delivery to unknown destinations (103,000 MT for delivery during the 2016-17 marketing year and 60,000 MT for the 2017-18 marketing year).
- Export sales of 112,000 metric tons of soybeans for delivery to Mexico (42,000 MT is for the 2016-17 marketing year and 70,000 MT the 2017-18 marketing year).
- Export sales of 125,000 metric tons of corn for delivery to unknown destinations for the 2016-17 marketing year.
