THE WEEK AHEAD
- Thanksgiving on Thursday will break up the week. Grain markets close at normal times on Wed and will remain close until Friday morning. Markets close an hour early on Friday. Currency, energies, equities and a host of other markets will only close for a few hours on Thursday.
- Congress is out for the Thanksgiving recess, with the House slated to return on Dec. 1 and the Senate on Nov. 30. Biden would “absolutely” meet with Senate Majority Leader Mitch McConnell (R-Ky.) on a Covid-19 relief package, transition team spokeswoman said over the weekend. Biden wants to get a package passed by the lame-duck Congress within the next couple of weeks, fitting the time after the election but before lawmakers adjourn for the year. As of right now, my outstanding bet for Biden to win the presidency (with an offshore book) has yet to be paid out. I remain on the lookout for surprises related to the election. I am not a constitutional scholar, but it seems to me this is headed for the higher courts. Meanwhile Biden makes plans for transition.
- Reports of a Russian grains export tax have surfaced again this morning, with Russian flour millers and animal meat producers reported to have submitted an appeal set a tax. The Agricultural Ministry has stated that it would consider a proposal on export taxes if an appeal were submitted Russian domestic wheat prices continue to hover above 18,000 Rb/t. The implementation of the tax would serve to discourage international shipments, pushing domestic sales to consumers due to declining purchasing power (weak Ruble). This would be very bullish international wheat markets (outside of Russia) who could potentially win that business. I see wheat as a buy; delivery begins on Friday, which seasonally has been a good time to get long ahead of winter growing problems.
- Meanwhile, global prices stay high. Pakistan reportedly bought around 340kmt of optional-origin wheat in a tender for up to 400k, at just under $287 kmt C&F for March arrival. Again, new highs for global wheat imports.
% OF NORMAL PRECIP FROM SEP 15- NOV 30
WHEAT- KC MARCH
WHEAT- MARCH CHI