We are hearing that NAFTA negotiations are going very well. US and Mexico are making progress with NAFTA. Soon Canada will be brought into the fold. Once NAFTA is worked out the US will hammer something out with the EU. China seems to be last on the list. Apparently the US thinks they will be in a position of power if they already have trade deals done with NAFTA and the EU before they deal with China. Stay tuned!
The WASDE is Friday and we are expecting higher yields and exports for corn. That should be neutral for the report but time will tell. We are also expecting the USDA to reduce global wheat production and comment on the drought in Europe, Asia, and Australia. Finally, we don’t know what to make of soybeans. It is a very difficult market right now. Good yields and no China deal sends beans to $8. Average yields and a China trade deal puts us to $10 or higher.
We also talk about the potential for more US wheat acres next year at the expense of soybeans, and more soybean acres over corn in South America. Both scenarios are bullish for US corn farmers.
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Craig Turner – Commodity Futures Broker
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