USDA Cuts Corn Harvest Forecast
Good Morning from Allendale, Inc. with the early morning commentary for November 11, 2019.

Grain markets are lower overnight after having mixed reactions to the WASDE report data with corn edging higher as the USDA trimmed their U.S. harvest outlook. Soybean futures pulled back on disappointing U.S. China trade news and larger than expected ending stock numbers on the WASDE report. Wheat futures traded higher briefly in tandem with corn futures, but retreated as the USDA's cuts to U.S. and southern hemisphere production were more than offset by larger crops in Europe and Black Sea regions.

Last week, December corn futures were down 12.75 cents, January soybeans down 6.5 cents, December wheat down 5.5 cents, December soymeal was up $1.20 and December soyoil was up 46 points.

USDA weekly crop progress report will be released tomorrow at 3 p.m. CST (due to government closures on Veterans Day). Trade is looking for corn harvest rating at 65% complete (52% complete last week, 84% last year, 84% 5-year average). Soybean harvest rating at 83% (75% last week, 87% last year, 92% 5-year average).

CFTC Commitments of Traders showed funds new net position short -104,846 corn contracts, long +58,429 soybean contracts, short -654 wheat contracts, long +60,829 live cattle contracts and long +13,258 lean hog contracts.

USDA November WASDE report showed corn production at 13.661 billion bushels (13.575 estimated, 13.779 last month, 14.420 last year). Corn yield dropped to 167 bu/acre (166.9 estimated, 168.4 last month, 176.4 last year). Harvested acres remained at 81.8 million acres (81.8 last month, 81.7 last year). Soybean production remained at 3.550 billion bushels (3.500 estimated, 3.550 last month, 4.428 last year). Soybean yield stayed the same at 46.9 bu/acre (46.5 estimated, 46.9 last month, 50.6 last year). Harvest acres were also unchanged at 75.6 million acres (75.387 estimated, 75.6 last month, 87.6 last year.

President Trump told reporters he has not agreed to roll back tariffs on China but that Beijing would like him to do so. Before leaving the White House, President Trump told reporters he would like to sign the deal in the U.S.

China has approved six new Argentine slaughterhouses and processing plants to handle the increasing amount of beef being shipped from the South American farming operations to China, an official said. "We have the advantage of being an economy that is complementary to Chinese demand, marking the way for us to establish a strategic alliance with one of the main actors of the world economy," Ag Minister, Luis Etchevehere said.

Exporters reported export sales of U.S. corn of 217,040 tonnes to unknown on Friday. There was also reported sales of 270,000 soybeans to unknown as well.

China is scouring the world for meat to replace the millions of pigs killed by African swine fever over the last 14 months. Their increased demand has boost prices, business and profits for European and South American meatpackers as it modifies global markets for pork, beef and chicken. Substantial tariffs on U.S. pork imposed by China are likely to mean the U.S. industry will benefit less than its rivals.

Dressed beef values were higher with choice up 0.83 and select up 0.24. The CME feeder index is 145.84. Pork cut-out values were up 2.03.