Good morning!
Corn and wheat higher, beans weaker early this morning... Corn and wheat futures firmed amid followthrough buying overnight. Soybeans traded higher at points overnight but are weaker early this morning. As of 6:30 a.m. CT, corn futures are trading mostly 4 cents higher, soybeans are 1 to 2 cents lower, winter wheat markets are 7 to 8 cents higher and spring wheat is 4 to 5 cents higher. The U.S. dollar index is around 100 points higher and front-month crude oil futures are around $2.50 higher.
White House urges resolution of dockworkers strike, avoids intervention amid mounting pressure... The White House is urging striking dockworkers and business owners to return to negotiations to resolve the East Coast, Gulf port strike. Despite increasing pressure from business groups, President Joe Biden, who identifies as pro-union, has refused to intervene using the Taft-Hartley Act, emphasizing his support for collective bargaining. Biden directed his chief of staff, Jeff Zients, along with other top officials to send a message to both sides that they should resolve their differences “fairly and quickly.” Business leaders, like Eric Hoplin of the National Association of Wholesaler-Distributors, are calling on Biden to act, fearing significant impacts on supply chains. Shipping giants Maersk and Hapag-Lloyd have announced plans for surcharges and schedule revisions due to the strike’s expected delays and increased costs at East Coast and Gulf Coast ports.
Port of Long Beach ready to absorb cargo amid East and Gulf Coast strikes... The Port of Long Beach, the second-busiest maritime trade hub in the U.S., is prepared to handle more cargo diverted from the East and Gulf Coast ports, where dockworkers are on strike for the second day. Currently operating at 70% capacity, the port is in a strong position to manage any surge in shipments, according to CEO Mario Cordero. As of early this morning, 28 container ships were anchored outside the major Atlantic ports and Houston, with many more en route from Asia and Europe. Asked by Bloomberg for his advice to the Biden administration about whether or not Washington should intervene to stop the strike, Cordero said stakeholders in the dispute are in a “wait-and-see” mode and there’s optimism for a resolution quickly without government involvement.
StoneX raises U.S. corn, bean crop estimates... Commodity brokerage firm StoneX raised its U.S. corn crop estimate to 15.222 billion bu. (15.127 billion bu. last month) on a yield of 184 bu. per acre, up 1.1 bu. from last month. StoneX raised its production estimate to 4.613 billion bu. (4.575 billion bu. last month) on a yield of 53.5 bu. per acre, up 0.5 bu. from early September. The firm’s estimates are based on surveys of its customers and assume USDA’s harvested acreage.
Russia’s weather agency sees ‘worse’ conditions for winter crops in key regions... Russia’s state weather forecast agency said conditions for winter crops in some key producing regions were “worse than usual” in October due to a lack of precipitation, specifically noting the Central, Southern, North-Caucasus and parts of the Volga regions. “A precipitation deficit will persist, and the conditions for the emergence and growth of winter crops in most areas will be worse than usual,” the agency said.
Treasury aims to finalize clean energy credits by year-end, leaves 45Z timing unclear... The Treasury Department is working to complete rules for clean energy credits under the Inflation Reduction Act (IRA) by the end of 2024, focusing on clean electricity production and investment credits under 45Y and 48E for technologies that produce electricity with no greenhouse gas emissions, according to Aviva Aron-Dine, acting assistant Treasury secretary for tax policy. Additionally, rules for clean hydrogen production (45V) and the advanced manufacturing production credit (45X) are expected to be finalized by the end of this year. However, Treasury did not provide a timeline for the completion of the 45Z clean fuel production credit, 45U zero-emission nuclear power credit and the 45W commercial clean vehicle credit. USDA Secretary Tom Vilsack has indicated the 45Z credit will likely be finalized before the Biden administration leaves office in January. Aron-Dine did say the agency continues to “actively work” on the 45Z and other credits, and has “received substantial stakeholder input regarding the unique dynamics of the credits’ respective markets; we’re now working to evaluate these issues with help from experts at other agencies.”
Netanyahu vows retaliation for Iran missile attack... Iran on Tuesday launched approximately 200 missiles at Israel, most of which were either intercepted or missed their targets, intensifying tensions in the Middle East. In response, Israeli Prime Minister Benjamin Netanyahu vowed retaliation, stating that Iran “made a big mistake” and would face consequences. Netanyahu emphasized Israel’s determination to defend itself and respond to its enemies, leaving the situation on edge as the conflict could escalate further depending on Israel’s next move.
Russia stops Kazakh grain transit in retaliation to imports ban... Russia effectively banned the transit and import of Kazakh grain and some other agricultural products on phytosanitary grounds, which some exporters viewed as retaliation for Kazakhstan’s earlier ban on Russian grain supplies. Russia’s agricultural watchdog said in a statement that from Sept. 23, its systems would automatically block the issuance of phytosanitary certificates for grain, grain products, sunflower seeds, tomatoes and peppers from Kazakhstan, which exports its grain to Europe and Turkey through Russian seaports. Without such certificates, the goods cannot cross the border.
Vice presidential debate highlights... Tuesday night’s vice-presidential debate between Tim Walz and JD Vance was civil compared to previous presidential debates, with both candidates finding some common ground while still highlighting key policy differences. Analysts say the debate is unlikely to change the trajectory of the presidential race. The Wall Street Journal (WSJ) in a commentary said Vance was “respectful, well prepared, articulate, and relentless in reminding voters about the flaws of what he called ‘the Kamala Harris Administration.’ This is a case Donald Trump was unable to make in his debate, or for that matter anywhere in the weeks since President Biden left the race.” WSJ said, “on presence and command, Mr. Vance won the debate going away.”
U.S. official: IMF ‘too polite’ on China policies, financing assurances... The International Monetary Fund (IMF) is “too polite” when it comes to criticizing China’s economic policies and should more fully disclose financing assurances given by China and some other countries to support IMF loan programs, a senior U.S. Treasury official said. Brent Neiman, Treasury’s deputy undersecretary for international finance, said IMF has failed to apply enough analytical rigor to China’s industrial policies. Neiman offered unusually pointed criticism of the IMF’s approach to China ahead of IMF and World Bank annual meetings later this month.
China files appeal to WTO on Canadian tariffs on EVs, metal products... China’s commerce ministry said it has asked the World Trade Organization (WTO) to rule on Canada’s imposition of steep tariffs on Chinese electric vehicles as well as steel and aluminum products. “China has raised a litigation to the WTO over Canada’s unilateral and trade protectionist measures and will conduct anti-discriminatory probe into these restrictive measures,” the ministry said. The ministry repeated its strong opposition to the tariffs, which it says will “disrupt and distort global industrial and supply chain.”
Wholesale beef price bottom?... At a minimum, it appears wholesale beef prices have stabilized and there are solid signs of a short-term bottom. Choice beef firmed $2.09 to $300.17, while Select rose 77 cents to $$285.30 on Tuesday. Despite the beef strength, packer margins remain in the red and it appears steady-at-best is the likely path for cash cattle prices.
Cash hog index, pork cutout firm... The CME lean hog index is up 12 cents to $84.13 as of Sept. 30, marking a gain in two of the past four days. The pork cutout firmed 47 cents on Tuesday to $96.31, while movement improved to 315.5 loads. Improving cash fundamentals are encouraging buying in futures. As of Tuesday’s close, the discount October hog futures held to today’s cash quote declined to 63 cents.
Overnight demand news... Thailand purchased 120,000 MT of optional origin (except Black Sea and EU) feed wheat. Algeria tendered to buy up to 320,000 MT of corn to be sourced from Brazil or Argentina. Japan is seeking 137,048 MT of milling wheat via its weekly tender. 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