Morning Quick Notes

Overnight
Mixed trade for grains overnight. Beans up 4 ¼ cents, corn unchanged, and wheat down 3 ½ cents.

Morning Headlines
The Trump administration said Monday it has approved a second round of payments in its bailout program for farmers hurt by the ongoing trade war with China. The Agriculture Department announced it will spend billions more through 2019 on direct cash aid to producers of soybeans, cotton, corn and several other commodities.

NOPA Crush showed November crush was 166.959 million bushels of soybeans and above the 163.546 million bushels crushed in November 2017.

Chinese soybean meal advanced for the first time in three days as President Xi Jinping said the nation would stick to its policy agenda, despite pressure from outside the country to allow more competition, potentially damping hopes of significant reforms to resolve the trade conflict with the U.S.

The EU has become a net grain importer for the first time since 2007/08 following a drought-affected wheat harvest, strong competition from Russian exports and a record pace of corn imports. As of Dec. 16, the EU has imported 13.15 million tonnes of grain so far in the 2018/19 season, compared with exports of 12.64 million tonnes.

Chart of the Day
The share of value of production that was under contract across all commodities in 2017 was 34 percent, close to the share in 1996/1997 (32 percent). More than 50 percent of U.S. peanuts, tobacco, sugar beets, hogs, and poultry/eggs in 2017 were produced under contract. In contrast, less than 20 percent of wheat, soybeans, and corn were grown under contract…The share of hogs produced under contract nearly doubled, from 34 percent in 1996/97 to 63 percent in 2017. Hog processors can use contracts to better control the characteristics of the hogs they acquire, helping them offer more consistent quality of meat to consumers. The decline in dairy reported under contract may reflect changing perceptions of farmers about their transactions with dairy cooperatives; more research is required to clarify that dynamic.