Good morning!
Grains weaker overnight... Corn, soybeans and wheat were pressured overnight by a stronger U.S. dollar and a lack of supportive news. As of 6:30 a.m. CT, corn futures are trading 1 to 2 cents lower, soybeans are 6 to 7 cents lower and wheat futures are 2 to 4 cents lower. The U.S. dollar index is around 350 points higher and front-month crude oil futures are about 50 cents higher.
U.S. embassy in Kyiv has temporarily closed amid warning of a ‘potential significant air attack’... This decision follows the embassy receiving specific intelligence suggesting an imminent threat, prompting officials to instruct embassy staff to shelter in place and advising U.S. citizens in Ukraine to be prepared for immediate shelter if an air alert is issued. This warning comes just a day after Ukraine launched American-supplied long-range ATACMS missiles into Russian territory for the first time, marking a significant shift in military engagement authorized by President Joe Biden. The strikes targeted a weapons warehouse in Russia’s Bryansk region, which has heightened fears of retaliation from Moscow. However, Russian foreign minister Sergei Lavrov said Russia would “do everything possible” to avoid a nuclear war.
Russian farmers switching away from wheat... Russian farmers say they will sow less wheat after heavy losses this year, switching to more profitable crops such as peas, lentils, or sunflowers, Reuters reported. Winter wheat plantings likely declined by 10% to the lowest since 2019, according to Rusagrotrans, Russia’s primary grain rail carrier. Some farmers say they have already decided to plant less spring wheat next year. Others are waiting to see how global wheat prices perform in the next few weeks before making a final decision.
China leaves lending benchmark LPRs unchanged... The People’s Bank of China (PBOC) kept its one-year loan prime rate (LPR), the benchmark for most corporate and household loans, at 3.1%. The five-year LPR, a reference for property mortgages, was held at 3.6%. Both rates remain at record lows following reductions in October and July.
Reuters poll: Trump tariffs will lower Chinese economic growth... The U.S. could impose nearly 40% tariffs on imports from China early next year, a Reuters poll of economists showed, potentially slicing growth in the world’s second-biggest economy by up to 1 percentage point. The poll, the first on China’s economy by Reuters since Donald Trump’s election victory on Nov. 5, predicts the president-elect will resist starting off with blanket 60% tariffs on Chinese goods, as he has threatened. The poll predicted new U.S. tariffs would reduce China’s 2025 economic growth by around 0.5 to 1.0 percentage point.
UK consumer inflation jumps more than expected in October... British consumer prices rose 2.3% from year-ago in October, up from a 1.7% increase in September, pushed up almost entirely by an increase in regulated domestic energy tariffs. This exceeded both the Bank of England’s target and market expectations of 2.2%. Annual core inflation edged up to 3.3% from 3.2%.
Omnibus spending bill faces long odds amid GOP skepticism... A year-end omnibus spending bill appears unlikely as conservatives push back and Senate Republicans eye greater leverage in 2025. Senate Minority Leader Mitch McConnell (R-Ky.) has signaled openness to a short-term funding bill, which could avoid clashes with the upcoming debt ceiling deadline but leave unresolved issues like disaster aid.
Republicans hesitate on tariff-funded tax cuts... Key Republican lawmakers expressed skepticism about using tariffs to fund tax cuts, citing economic and political concerns. While some, like Sen. Chuck Grassley (R-Iowa) remain open to discussion pending concrete proposals from President-elect Donald Trump, others including Sen. Rand Paul (R-Ky.), liken tariffs to a “sales tax” and doubt their inclusion in the tax bill. Free-trade advocates warn of potential macroeconomic consequences.
Summit Carbon Solutions resubmits pipeline permit application in South Dakota... Summit Carbon Solutions has refiled for a new permit for its 700-mile carbon capture pipeline route through South Dakota, part of a larger 2,500-mile project spanning five states. The pipeline will transport CO₂ from 57 ethanol plants to be stored in North Dakota using Class VI injection wells. Construction is set to begin in 2026, with operations starting in 2027. The project also offers additional capacity for green fuels and industrial uses. Public safety meetings are ongoing as the company seeks support amid regulatory hurdles.
USDA launches $2 billion in aid for specialty crops and disaster recovery... As expected, USDA officially announced $2 billion through the new Marketing Assistance for Specialty Crops initiative to support domestic supply and market expansion for fruits, vegetables and nuts. Additionally, $140 million will fund the Commodity Storage Assistance Program, aimed at restoring crop storage infrastructure lost to 2024 natural disasters, particularly benefiting Southeastern producers after Hurricanes Debby, Helene and Milton.
HPAI and livestock outbreak intensifies in California... California continues to face severe challenges with highly pathogenic avian influenza (HPAI) and livestock infections. Recent confirmations in commercial poultry operations have affected nearly 700,000 birds as of Nov. 14, bringing the state’s 30-day total to 17 commercial and four backyard flock cases, impacting 3.96 million birds. Since the outbreak began, 60 commercial and 30 backyard flocks have been confirmed, totaling 11.97 million birds. Additionally, the state has reported 202 dairy cattle infections in the last 30 days, with 336 cases since the outbreak’s onset.
Choice beef stabilizes, Select continues to weaken... Choice boxed beef prices firmed $1.51 to $308.79 on Tuesday, marking the second straight strong daily gain. Select dropped $3.54 to $271.91. That increased the Choice/Select spread to a wide $36.88.
Cash hog fundamentals continue recent slump... The CME lean hog index is down another 40 cents to $88.09 as of Nov. 18, the seventh decline in the last eight days during which the index has dropped $2.52. The pork cutout fell $2.39 on Tuesday to $94.68 amid sharp declines in primal loins, bellies and picnics, though movement improved to 393.3 loads, signaling strong retailer demand on the price drop.
Overnight demand news... Algeria purchased an unspecified amount of corn to be sourced from Brazil or Argentina and an unspecified amount of Canadian durum wheat. Taiwan tendered to buy 80,000 MT of U.S. milling wheat. Jordan tendered to buy up to 120,000 MT of optional origin milling wheat.
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
· 9:30 a.m. Weekly Ethanol Production — EIA
· 2:00 p.m. Broiler Hatchery — NASS
· 2:00 p.m. Supply and allocation of milk fat and skim solids by product (Annual) — ERS
· 2:00 p.m. Farm Labor — NASS
· 2:00 p.m. Milk Production — NASS