Headlines:
- President Trump has proposed a 20 % tax on imports from Mexico to pay for the wall on the southern border of the U.S. between the two countries. The tax would supposedly create $10 billion a year to pay for the construction of the wall
- The World Health Organization is warning that the proliferation of bird flu around the world is raising the risk of a jump to humans and creating a human flu pandemic
- China headed for glut of seed corn as well
Much has been made of the Chinese grain corn stockpiles, but the country is also heading for a massive glut of seed corn. Chinese corn seed production is booming at a time when the government is pushing to reduce grain corn plantings, which will push the stocks to use ratio to nearly 80% in 2016-17, according to figures from the US Department of Agriculture’s Beijing beau. Chinese corn seed production is at the second highest level seen in the last two decades, analyst CCM said. CCM saw the boom in production driven by a rise in the number of authorized seed varieties. “Secondly, the crop damage as a result of natural disasters has not been as critical as in recent years, allowing the much higher output of corn seeds compared to last year,” CCM said.
Summary:
Wheat futures took dive today surrendering the gains from yesterday. One of the potential issues for Wheat is the strength in the US Dollar. Price reached near term resistance and as much as the chart suggests that it can move up a bit higher, the USD strength continues to weight on its ability to be competitive. Concern over winterkill both domestically and globally has largely dissipated leaving Wheat with it first weekly finish in the red over the last five weeks. According to the BAGE Argentina’s Corn planting is 98% complete. The planting area remained unchanged at 4.9 million hectares. Corn was essentially flat today closing at 363 down 0.75 cents on the day. BAGE also estimated the Argentine Soybean crop at 53.5 million tones which is 2.5 million less than the 2015-16 crop and 3.5 million below the January 12th USDA estimates. The main reason for the decline site was flood damage according to the Argentine Ag Ministry. Beans was only off 1 tic today closing at 1049.25.
