The markets are dealing with a couple of negative issues as we close out the week. First is the disappointing export sales report yesterday morning, which caused an immediate price reversal when those numbers came out. The second issue is around the heightened trade concern due to the ASF outbreak in China. There are some stories saying that the problem is much worse than the initial concerns we heard about a few weeks ago. China has been the main reason for the sustained price rally over the past several months; rebuilding of their swine herd and rebuilding their grain reserves have been the primary demand increase catalysts for these higher prices. There have not been any large cancellations reported of outstanding U.S. sales, however embedded in the export sales report yesterday were a couple of small Chinese cancellations of beans and sorghum. The market will be very watchful of more coming.
February is crop insurance price month, and thus far the December corn month average is $4.57 and November beans are $11.82. Both will be the highest insurance base levels in several years.
Managed money turned big sellers yesterday and that continued in the overnight session.
Corn: down 5-8c
Beans: down 17-20c