U.S. pork exporters will soon be free to ship meat to Argentina for the first time in 26 years after the two countries thrashed out an agreement to overturn an Argentinian import ban.

The deal is a sliver of good news for U.S. farmers facing trade tariffs and disruption to exports to the biggest global agricultural buyer, China.

China, the top global pork consumer and soybean importer, last week imposed a 25 percent tariff on imports of U.S. pork and threatened a tariff on soybeans, sending prices for both commodities lower.

Corn analysis

Corn closed the week $.08 1/2 lower. Last week, private exporters did not announce any private sales.

Weekly export sales of corn showed a total of 47.4 mb (1,203,900 mt) with 43.0 mb (1,091,700 mt) for the 2017-2018 marketing year. This put total marketing year sales at 1.940 bb, 2 percent less than the previous marketing year. U.S. corn planting is 3 percent complete versus 5 percent expected as producers only made 1 percent of progress nationwide last week.

This is behind the 6 percent last year and the 5 percent on average.

By the end of April, corn and spring wheat seedings should reach 40 percent done normally. In the weekly EIA report, ethanol production was reported at 1.009 million barrels per day, down 25k barrels per day. This is the fourth week of seeing declines in production (just barely holding above a million barrels per day).

Midwest U.S. producers have begun seeding the corn crop and weather will become very important to pricing by May.

Strategy and outlook

As producers get planters out of their sheds and begin seeding the 2018 crop, look to either make sales and reown with call options or buy puts to establish a price floor.

Soybeans analysis

Soybeans closed the week $.21 1/2 lower. Last week, private exporters did not announce any sales.

Weekly export sales of soybeans showed a total of 78.3 mb (2,131,400 mt) with 38.2 mb (1,040,700 mt) for the 2017-2018 marketing year. This put total marketing year sales at 1.986 bb, 3 percent less than the previous marketing year.

The March soybean crush among NOPA members was reported at 171.9 million bushels, above average market expectations of 168.2 million and a very impressive 12.3 percent above last year’s March crush of 153.1 million bushels. This set a new all-time record monthly crush in surpassing the previous record of 166.3 million bushels set in December 2017. Despite crush being well above expectations, end of March soybean oil stocks were reported at 1.946 billion pounds, which was in line with average market expectations of 1.962 billion bushels and up from February stocks of 1.856 billion pounds and solidly above year ago March NOPA stocks of 1.815 billion bushels. Demand has slowed and soybeans are pulling back from major resistance levels.

Strategy and outlook

As producers get planters out of their sheds and begin seeding the 2018 crop, look to either make sales and reown with call options or buy puts to establish a price floor.

This material has been prepared by a sales or trading employee or agent of Midwest Market Solutions and is, or is in the nature of, a solicitation. This material is not a research report prepared by Midwest Market Solution’s Research Department. The risk of loss in trading futures and/or options is substantial and each investor and/or trader must consider whether this is a suitable investment. Past performance, whether actual or indicated by simulated historical tests of strategies, is not indicative of future results. Trading advice is based on information taken from trades and statistical services and other sources that Midwest Market Solutions believes are reliable. We do not guarantee that such information is accurate or complete and it should not be relied upon as such.

Brian Hoops can be reached at (605) 660-1155.