Good morning!
Corn and beans weaker, wheat mostly firmer early this morning... Corn and soybeans faced price pressure throughout the overnight session, while wheat rebounded from earlier weakness to trade mostly firmer. As of 6:30 a.m. CT, corn futures are trading a penny to 2 cents lower, soybeans are 6 to 8 cents lower, SRW wheat is steady to fractionally lower, HRW wheat is 2 to 3 cents higher and HRS wheat is steady to 2 cents higher. The U.S. dollar index is around 110 points lower and front-month crude oil futures are about 60 cents higher.
Cordonnier keeps South American crop estimates unchanged... South American crop consultant Dr. Michael Cordonnier kept his Brazilian soybean and corn crop estimates at 171 MMT and 125 MMT, respectively. He has a neutral to higher bias for the bean crop and is neutral toward corn. Cordonnier left his Argentine crop estimates at 53 MMT for soybeans and 50 MMT for corn, with a neutral to lower bias toward both crops given building moisture stress.
HRW wheat conditions deteriorate in December... State-level winter wheat crop condition ratings signaled general deterioration in the HRW crop during December, led by top producer Kansas and Nebraska. The “good” to “excellent” ratings for HRW wheat fell eight points in Kansas (to 47%), three points in Oklahoma (45%), 21 points in Nebraska (27%) and two points in South Dakota (22%) during December. The “good” to “excellent” ratings for HRW wheat improved two points in Colorado (70%) and three points in Montana (42%) over the past month. Texas did not update winter wheat conditions. On the weighted Pro Farmer Crop Condition Index (0 to 500-point scale, with 500 being perfect), the HRW crop declined 9.0 points from the end of November to 330.3.
Chinese rapeseed meal futures react to Trudeau resignation plans... China’s rapeseed meal futures fell to a three-week low on Tuesday after Canadian Prime Minister Justin Trudeau’s plans to resign sparked hope that trade tensions between Beijing and Ottawa will soften. The most active rapeseed meal futures for May delivery on the Zhengzhou Commodity Exchange fell 3.14% on Tuesday to 2,284 yuan ($311) per metric ton, the weakest close since Dec. 19 and the sharpest daily decline in a month. Around 40% of Canada’s rapeseed exports typically go to China, accounting for 90% of China’s imports of the oilseed.
High-stakes port negotiations resume amid automation dispute... Negotiations between the International Longshoremen’s Association (ILA) and the United States Maritime Alliance (USMX) restart today after breaking down in early November. With the current contract extension expiring on Jan.15, both sides face significant pressure to avoid a strike that could cost the U.S. economy an estimated $3.78 billion to $4.5 billion per week. A group of USMX representatives met with ILA leaders on Sunday to draw up language on automation ahead of this week’s formal negotiations, CNBC reported. The resulting proposal would give the union the right to create human jobs to complement technology implemented at ILA-operated ports. Both sides are under intense pressure to find a compromise and prevent a potentially crippling disruption to U.S. supply chains.
Canada gears up for potential trade tensions with incoming U.S. administration... As Donald Trump’s inauguration nears, Canada is preparing for potential trade challenges following the president-elect’s threat of a 25% tariff on Canadian imports. The Canadian government is considering a proactive approach, including the possible early release of a retaliatory tariff list. A report from The Globe and Mail reveals that Canada might unveil a list of American goods subject to retaliatory tariffs ahead of time. This strategy was deliberated during a Canada/U.S. cabinet committee meeting on Monday, though no final decision has been made. A Canadian contact told us, “This retaliatory list idea is very similar to past Canadian strategies and will likely strategically target certain states to influence reaction.”
Indonesia joins BRICS to bolster Global South cooperation... Indonesia, Southeast Asia’s largest economy, has officially joined the BRICS bloc, marking a significant step in strengthening the Global South’s influence in global decision-making. The announcement was made by Brazil, the current president of BRICS, following unanimous approval by member nations. The inclusion further solidifies BRICS’ position as an alternative to the U.S.-led global order, following its recent expansion to include Iran, Egypt, Ethiopia, and the UAE. The move comes as developing nations prepare for potential trade challenges under Donald Trump’s upcoming presidency, including protectionist policies and sanctions on dealings with Chinese firms.
Yellen raised serious concern about China’s ‘malicious’ cyber activity... Treasury Secretary Janet Yellen met virtually on Monday with Chinese Vice Premier He Lifeng and raised concerns about “malicious cyber activity” carried out by Chinese state-sponsored actors, the Treasury Department said. “Secretary Yellen... expressed serious concern about malicious cyber activity by PRC state-sponsored actors and its impact on the bilateral relationship,” Treasury said, describing the call as candid, in-depth and constructive. The two officials also discussed economic developments in both countries and reviewed progress made during meetings of the working groups. Yellen reiterated concerns she has raised repeatedly about China’s non-market practices and policies and industrial overcapacity, noting they would continue to adversely affect the U.S./China bilateral economic relationship unless addressed.
U.S. blacklists China’s largest shipping line amid growing maritime concerns... The Biden administration has added China’s largest shipping line, Cosco Shipping Holdings Co., and two major shipbuilders to a Pentagon blacklist over alleged ties to the People’s Liberation Army. This move, which also includes Tencent Holdings Ltd. and Contemporary Amperex Technology Co., signals increased scrutiny of China’s dominant maritime sector. While the blacklist imposes no direct penalties, it discourages U.S. firms from engaging with the listed companies. The announcement comes as Washington expresses alarm over China’s control of global shipbuilding — responsible for nearly 60% of worldwide orders — contrasting with the decline of the U.S. industry.
Euro zone consumer inflation accelerates in December... The euro zone’s annual consumer inflation rate accelerated for a third straight month to 2.4% in December, the highest rate since July, preliminary estimates showed. Core inflation held at 2.7% annually for a fourth straight month.
USDA boosts specialty crop support with $650 million funding increase... Farm-state lawmakers welcomed USDA’s announcement of an additional $650 million for the Marketing Assistance for Specialty Crops (MASC) program, increasing total funding to $2.65 billion. Key updates include a raised payment limit of $900,000 per producer (from $125,000) and an extended application deadline to Jan. 10. The funding aims to help specialty crop producers manage costs and expand markets. The decision follows calls from the Specialty Crop Farm Bill Alliance for greater support, emphasizing the role of specialty crops, which account for nearly 30% of U.S. crop cash receipts.
U.S. reports first human H5N1-related death... A Louisiana resident over 65 with underlying health conditions has become the first confirmed fatality from the H5N1 virus in the U.S., state health officials announced Monday. The patient contracted the virus after exposure to a backyard flock and wild birds. The risk to the general population from H5N1 bird flu remains low, the World Health Organization and the U.S. Centers for Disease Control and Prevention reiterated. Meanwhile, the Iowa Department of Agriculture and USDA confirmed an outbreak of highly pathogenic avian influenza (HPAI) in a multi-species backyard flock in Clinton County, continuing a string of outbreaks in the state from late last year.
Cash cattle surge to new high... Cash cattle averaged a record $198.93 last week, up $4.12 from the previous week and the seventh straight gain. During that span, cash prices jumped more than $14.00, despite packer margins being deeply in the red.
Cash hog downtrend accelerates... The CME lean hog index is down another $1.11 to $82.01 as of Jan. 3, marking the sixth straight daily decline and the biggest drop since August. The pork cutout fell $1.71 on Monday to $87.83, as all cuts except bellies posted sharp losses.
Overnight demand news... Exporters reported no tenders or sales.
See ‘Policy Updates’ for late-breaking morning news updates... For updates to items in “First Thing Today” or any late-breaking morning news stories, check “Policy Updates” on www.profarmer.com.
Today’s reports
· 10:00 a.m. Ag Trade Data — FAS