Late Planting and Projections of 2019 U.S. Corn and Soybean Acreage


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15 May 2019



Video commentary for May 14th 2019



Eoin Treacy's view

A link to today's video commentary is posted in the Subscriber's Area. 

Some of the topics discussed include: Major indices firm from the region of their respective trend means, oil steady, grains and beans surge, gold eases, Dollar steady, bonds quiet. 



U.S. Stocks Extend Rebound From Trade-Driven Rout: Markets Wrap

This article by Randall Jensen and Sarah Ponczek for Bloomberg may be of interest to subscribers. Here is a section:

“Investors are looking for opportunities to get into this market, and so far in 2019 there really haven’t been any ‘buy the dip’ opportunities other than last week,” Ryan Nauman, market strategist at Informa Financial Intelligence, said by phone. “And you’re also seeing President Trump confirmed a meeting with President Xi during next month’s G-20 summit, which provides some optimism that despite the increase in tariffs, negotiations are still ongoing.”

Even as investors pick through Monday’s carnage for deals, the trade tussle between Washington and Beijing is keeping markets on edge as traders try to gauge its impact on the global economy. On Monday, all three major U.S. benchmarks dropped more than 2% -- only the second time this year that’s happened -- after China targeted some of the biggest U.S. exporters in response to American tariffs. Trump eased concerns talks would break down when he said he and Chinese President Xi Jinping would meet at the G-20 conference in late June.


Eoin Treacy's view

Investors don’t believe a trade war is inevitable and still hope that a deal will be done sooner rather than later. The threat from that conclusion is the extension of tariffs from the original set of goods to all goods imported from China will have an inflationary effect which is not being priced in. That is not so surprising considering how wrong inflation forecasts have been over the last decade. Nonetheless, the risk of inflation from escalating tariffs is non trivial.



Late Planting and Projections of 2019 U.S. Corn and Soybean Acreage

This article by Scott Irwin and Todd Hubbs for Farmdocdaily may be of interest to subscribers. Here is a section:

The impact of late planting on projections of the U.S. corn and soybean planted acreage is an important question right now due to the very wet and/or cold conditions so far this spring through much of the Corn Belt.  We estimate the relationship of late corn planting to corn and soybean planted acreage and prevented plantings in this article.  If late corn planting is 10 percent or more above average, we find that the chance of corn planted acreage decreasing is 83 percent and the average decrease is 1.4 million acres.  The level of prevented plantings for corn is about 1.2 million acres larger than average when late planting is near 10 percent or more above average.  This indicates that there is a reasonably high chance that planted acreage of corn will decline 2-3 million acres from expectations based on the March 30 USDA Prospective Plantings report.  Likewise, we find that when late corn planting is 10 percent or more above average that the chance of soybean planted acreage increasing is 83 percent and the average increase is 0.9 million acres.  However, the level of prevented plantings for soybeans also increases, offsetting much of the acreage switch.  This indicates there is a reasonably high chance that planted acreage of soybeans will not change much compared to expectations based on the March 30 USDA Prospective Plantings report.  It should be noted that changes to corn and soybean planted acreage could be even larger if planting conditions do not improve substantially in the next two weeks.  Finally, corn and soybean acreage changes could also be impacted by policy changes made in response to reaching or not reaching a trade deal with China.


Eoin Treacy's view

The flooding which left much of the USA’s midwest under water for much of February has had an effect on planting has represents a catalyst for short covering as a number of grains and beans are in the region of multi-year lows.




Oil Rises as Drones Strike Saudi Pipeline and Trade Fears Recede

This article by Alex Nussbaum and Grant Smith for Bloomberg may be of interest to subscribers. Here is a section:

Oil climbed as drones struck Saudi Arabia’s main cross-country crude pipeline, while President Donald Trump said a trade deal with China is still within reach.

Futures gained 1.2% in New York, amid assaults on the world’s chief crude exporter. State-owned Saudi Aramco halted operations in the area after the strike on two pumping stations, which was claimed by Iran-backed rebels from neighboring Yemen. The attack followed damage to four oil tankers anchored off the United Arab Emirates on Sunday.


Eoin Treacy's view

The intensification of sanctions on Iran risked retaliation among the country’s proxies across the Middle East with Yemen being a good example. It is almost inevitable that Hizballah will now also rachet up activity as well.



2019: The 50th year of The Chart Seminar



Eoin Treacy's view

There will be a memorial concert for David at the Royal Festival Hall on October 5th. It looks like we will have a room at the Royal Festival Hall for an hour before the concert for a memorial. Wine and canapes will be served. Afterward we will retire to the Benefactor's Lounge where Tim Walker, Chairman of the LPO will dedicate the concert in David's memory. The concert will be from 7:30 to 10pm. If anyone would like to attend the concert in addition to the memorial there will be a box to tick on the booking form which I will provide as soon as I have it.   

Since this is the 50th year of The Chart Seminar we will be conducting the event on October 3rd and 4th to coincide with the memorial on the Saturday.

In the meantime, if you have any questions, would like to attend, or have a suggestion for another venue please feel to reach out to Sarah at [email protected].  

The full rate for The Chart Seminar is £1799 + VAT. (Please note US, Australian and Asian delegates, as non-EU residents are not liable for VAT). Annual subscribers are offered a discounted rate of £850. Anyone booking more than one place can also avail of the £850 rate for the second and subsequent delegates.


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