Periodic Updates on the Futures Markets

November canola is down $4.30 per metric ton (mt), Dec soybean oil is down .87 cents per pound, November European rapeseed is down 4.00 euros per mt and November Malaysian palm oil is down 1.67%. Dec oats are down 9 1/4 cents per bushel. November crude oil is down $.19 per barrel, November ULSD is down $.0049 per gallon, and the December Canadian dollar is down .00220 at .72655. The December U.S. Dollar Index is down .135 at 97.135 and the October Brazilian real is down .00115 at 0.18640.

Besides grains and oilseeds being under pressure thanks to the lack of even a mention of soybean trade between President Trump and Xi Jinping on Friday (officially anyway), beneficial harvest weather being on the way if not arrived yet for any area in question, and ongoing pressure on commodities thanks to Powell’s recent hawkish press conference — Argentina’s accelerating crisis of confidence by investors has started to impact ag trade with word that they are going to eliminate export taxes for the next six weeks. The combination of a sharp devaluation of their currency recently and elimination of export taxes makes their soy complex exports much more competitive. The bearish response by the trade is in anticipation of a rush of farmer selling. That may be an overreaction considering the situation leaves no confidence in having a volatile currency in your pocket instead of physical commodities in your bin. Besides that, they crush most of their soybeans and export the products. For 2024-25, they are only expected to export 7.3 mmt of soybeans over the entire year so not a market mover. Exports of soybean meal, on the other hand, account for roughly a third of world exports while soybean oil exports are roughly 47% of the world total. That has pressured soybean oil particularly hard, following through to canola. It may have also been primarily responsible for the sharp break seen in those two markets over the past four sessions. Word that the U.S. is going to step in to try to stabilize the financial situation may restore some confidence, allowing for bargain hunting.

Outside markets are calm throughout the developments in Argentina with treasuries trading quietly lower, equities quietly higher (near record levels), energy markets mixed, and the U.S. dollar remaining quietly lower.