Miller Magazine Issue 110 / February 2019

88 MARKET ANALYSIS MILLER / FEBRUARY 2019 The February long awaited WASDE report was a kind of replay. The market was expecting new data from the re- port, but this turned out to be far from the figures shown by local agro agencies. Given the limited processing time for critical data still accumulated in 2018, WASDE will take much longer to comprehend and report on current global data changes. The market reaction practically con- firms that the planned reports are less significant. One of the obstacles for the market recently has been the revival of the US dollar. Traders remained cautious amid uncer- tainty about the US trade agreement with China and the weather in Latin America. Trade negotiations between the US and China continue to worry the market, as the “big guys” will resume negotiations on 12/02/2019 in Beijing. No one expects much from the meetings, but still believes that ongoing discussions will keep the word on the market and reduce the likelihood of a purchase. Currently, US Trade Representative Robert Lightheiser and US Treasury Secretary Stephen Mnuchin will conti- nue meetings in China February 14-15. President Trump will not announce that he agrees to meet with Chinese Prime Minister Xi. World production of coarse grains in 2018/19 is proje- cted at 1.5 million tons lower. The coarse grain outlook for increased production and consumption in February, as well as a slight decline in trade. World corn production is declining on US, Mexico and South Africa somewhat offset the increase yield in Argentina, China and Ukraine. According to forecasts, both in Argentina and in Ukrai- ne the harvest will be a record. Ukrainian is even more than official data. World trade has changed minimally since the increase in imports to Chile and South Africa slightly offset the decline in Venezuela. Corn production in Argentina is growing due to higher expected area and yield, and heavy rainfall and favorable temperatures over the past two months increase yield prospects. South Africa is reduced because the heat and drought in January, especially in the western areas of production, reduce the yield prospects. As for the bear side, world final stocks are projected at 309.78 million tons, which is 1 million tons more than in December. Ending stocks of corn are hig- her, mainly reflecting growth in Argentina and China. China will hold 207.8 million tons. The USDA left Brazil’s production figures at 94.5 million tons, Ar- gentina - 46 million tons, which is 3.5 million tons more than in December. Argentinean analyst expects 45-47 million tons. CO- NAB is expected to update its Brazilian numbers on 12/02/2019. The forecast for corn in the US below. For ethanol, this reduction is based on the most recent data from the report on the production of cereal grains and by-products and the weekly data on ethanol production submitted by the Energy Information Administration for December and January. World production of oilseeds this month is projected at 593.3 million tons. Soybean production accounted for most of the decline by 8.2 million tons to 361.0 million tons. Losses in the USA, Brazil and other South American exporters dominated. AgRural Consulting on lowered its forecast for Brazilian soybeans to 112.5 million tons, ba- sed on recent hot and dry conditions. This will be the smallest soybean crop in 3 years. But the USDA showed