Play Turner’s Take Podcast Episode 200

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In our latest podcast we go over the expected Fed interest rate cut, the attack on Saudi Arabia’s crude oil operations, Chinese soybean purchases, and what we want to do in the grain markets for 2020.  We also talk about livestock, Trump’s disposition to choose financial wars over military wars, and finishing weather for US crops.  Make sure you take a listen to Turner’s Take Podcast

Macro Markets

The Fed is expected to cut rates today by 25 basis points.  The market will very interested to hear what the Fed says about future rates.  The quarter point seems to be baked into the market already. If we rally after the announcement I’m guessing the Fed is giving clues to further easing.  If we go lower the Fed is probably signaling a “wait and see” attitude about any more stimulus to the economy.

Sept 2019 Emini S&P

Livestock

South Korea confirmed a second case of African swine flu.  We are also hearing rumors of ASF in Thailand.  It seems like all of Asia will be dealing with ASF one way or another.  This is not necessary bullish for US pork demand.  Some nations will not import pork from the US because of some of the additives/growth drugs we use in some of our production.  If their is no trade deal with China between now and the election, then I think hogs go lower in the deferred months.  June Hogs above 90 seem awfully high with large supplies and no trade deal in sight

June 2020 Lean Hogs

Grains & Oilseeds

Soybean demand has been hurt by both the US/China trade war and the ASF outbreak.  Wheat prices are low as the world is awash with supplies. Both of these keep corn prices low during rallies.  Even with lower 2019 crop production there is only so much we can rally if the demand is not there.  In the podcast we go over how farmers should be hedging in 2020 and 2021.  Below is a chart of Nov 2020 Soybeans and Dec 2020 corn.  I think farmers and traders can sell the resistance and cover into support for both of these markets.  The bias for both corn and soybeans next year will be bearish.  Farmers are naturally long the crop. I think the play is to sell the rallies and then buy on gains of 15 to 20 cents in soybeans and 5 to 10 cents in corn.

Dec 2020 Corn

Nov 2020 Soybeans

About Turner’s Take Podcast and Newsletter

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Craig Turner – Commodity Futures Broker

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