The Hueber Report

While still behind the average pace, enough headway was made with bean harvest last week to discourage a few more would-be bulls in the bean market.  Moving ahead by 15% points, as of the weekend bean harvest was estimated to be 53% complete.  Normal for this date would be 69% but as we have noted before, a combination of wet weather and standability issues in corn prompted many to work on that crop first but with predominately clear skis now in the forecast, bean harvest should continue to advance rapidly.  Corn harvest did increase by 10% to 49% complete, keeping the pace just barely ahead of average.  

There is quite a bit of unease around the equity markets this morning, which is probably creating caution everywhere else.  Beginning with a break in the Asian markets, the selling has worked its way around the globe, and we have pretty hefty selling here now in the U.S., which has been exacerbated by two major U.S. companies, 3M and Caterpillar missing 3^rdquarter expected earnings.   While not by a significant amount just yet, we have pressed through the panic lows set last week.  A price you may want to keep in mind is 2,668 in the S&P or 24,719 on the DJIA as those are the levels, we closed at to finish 2017.  Pressing into negative territory for the year again could incite a rush for the exits. 

Chinese import numbers for the month of September have been released, and obviously, they have backed off almost all ag imports.  Compared with the previous year, sorghum imports were down 76.9%, corn imports down 83.4% and barley imports down 27.1%.  One exception to the rule is pork.  These were up 8.4% over last year.  Granted, they are not coming from the U.S., but with the ongoing African swine fever issues there as well as in parts of Europe, it would stand to reason that eventually the global demand could “trickle down” to the U.S.

In his weekly commentary, Dr. Cordonnier brought forth some interesting comments about the upcoming election in Brazil.  Favored to win is Jair Bolsonaro, who is on record as stating that the environmental policies in that nation are “suffocating the country.” While the level of deforestation has declined, not stopped, under the existing laws, Mr. Bolsonaro would like to reverse that trend and finds support from the soybean and corn producers in that country.  Needless to say, that is not good news for U.S. producers of not only soybeans but nearly all crops and livestock we produce and export.