Katie Murphy

Aug 25, 2020


  • US Trade Representative Lighthizer, US Treasury Secretary Mnuchin and Chinese Vice Premier Liu He had their first formal dialogue since early May via a phone call in order to reaffirm their commitment to Phase 1. China’s commerce ministry stated that the talks were constructive and that they would continue to push for the fulfillment of Phase 1.
  • The USDA reported a drop in soybean and corn conditions from last week, while spring wheat saw a slight increase in conditions.
  • China announced that it is selling 10,000 tonnes of frozen pork from the state reserves on August 28th.
  • US stock futures are trading higher this morning after seeing another record setting session yesterday. The S&P 500 closed above 3,400 yesterday for the first time as optimism stems from a recent decrease in confirmed infections in the US.
  • As of 7:00 AM: Crude oil up 0.20 at 42.82, Dow futures up 199 ticks at 28,438, and the U.S$ index down 141 ticks at 93.157.                          


  • The corn market is trading higher this morning, hitting a new six week high due to support from the recent US and China trade talks and deteriorating crop conditions.
  • The USDA reported that corn conditions are seen at 64% G/E, this is down 5% from last weeks 69% rating. Iowa was down 9% in the G/E category to 50%.
  • The USDA reported that US corn is 88% in the doughing stage, vs the 82% 5 year avg and 44% dented vs the 39% 5 year avg. US corn is now 5% mature, right in line with the 5 year avg.  
  • Open interest for corn was seen dropping by 14,830 contracts, with the September down 21,500 contracts.
  • Spreads: U/Z 13 ¾ cent carry; U/H 25 ½ cent carry; Z/N 23 ¼ carry .

Outlook: Trading higher today due to support from worsening conditions and Chinese demand.


  • The soybean market is trading higher this morning with support still stemming from Chinese purchases and recent trade talks.
  • The USDA reported that US soybean conditions decreased to 69% G/E vs 72% last week. Soybeans are seen at 92% setting pods vs the 5 year avg of 87% and 4% are seen dropping leaves, identical to the 5 year avg.
  • Customs data showed that China’s soybean imports from Brazil surged in July by 27% compared to the year prior. Good crush margins in recent months is the source for these high imports.
  • Malaysian palm oil exports for the August 1-25 period were seen at 1,220,063 tonnes vs the July 1-25 period that was seen at 1,424,389 tonnes. Palm oil futures were seen hitting close to a two week low due to the poor export numbers.
  • Spreads: U/X 6 ¾ cent carry, X/F 7 ¼ cent carry, X/H 9 ½ cent carry

Outlook: Trading higher today as the market is supported by Chinese purchases.


  • Wheat markets are trading higher this morning due to a recent uptick in export demand as several countries across the globe have recently issued tenders.
  • The USDA reported that spring wheat conditions increased by 1% to 71% G/E. Harvest is now reported at 49% complete, below the 5 year avg of 62%. US Winter wheat harvest was reported at 97% complete vs the 98% 5 year avg.
  • Kazakhstan’s Agriculture Minister Omarov stated today that Kazakhstan’s grain crop for 2020 is seen at 18 million tonnes, with 7.5 to 8.0 million tonnes available for exports.
  • Tenders: Jordan has issued a new tender to purchase 120,000 tonnes of wheat. The lowest offer for Turkey’s tender to purchase 390,000 tonnes of wheat is said to be $209 per tonne C&F. Taiwan flour millers tender to buy 100,645 tonnes of wheat to be sourced from the US. Pakistan is said to have initially bought 210,000 tonnes of wheat in its tender to purchase 1.5 million tonnes.
  • Spreads: Chicago U/Z 7 ½ cent carry; Kansas City U/Z 11 cent carry; Minneapolis U/Z 14 ½ cent carry.

Outlook: Trading higher today due to a recent uptick in global demand.