AGS WEEK AHEAD: Mixed Mood as Market Digests Trump Victory

By Joe Hoppe

A roundup of key agricultural commodity markets for the week starting Nov. 11 by Dow Jones Newswires in Barcelona.

GRAINS & OILSEEDS: The mood is mixed for agricultural commodity markets as investors digest Donald Trump's victory in the U.S. presidential election.

Stock markets and inflation expectations are up following the election, tailwinds for agricultural futures, but key commodity currencies like the Brazilian real and Australian and Canadian dollars are weak against the U.S. dollar, Peak Trading analysts said in a note. Traders will spend now until Trump's January inauguration looking for policy specifics, including on tariffs, taxes, labor and fiscal issues.

Export demand has been solid as traders race to lock in cargos ahead of Trump's expected tariffs. Corn and soybean sales were strong last week, with big flash sales.

Meanwhile, South American weather looks ideal for crops, with planting accelerating in Brazil. The country is preparing for a large harvest that could reduce U.S. export demand starting from February, especially with new tariff concerns, Peak Trading wrote.

U.S. consumer price index data will be released on Wednesday. If inflation statistics come in firmer, the dollar is likely to rally further, a growing threat to agricultural markets, Peak Trading said.

Seasonal prices tend to be bearish in November, particularly for the grain and sugar markets, before turning bullish in December due to the festive period.

Chicago wheat futures are down 2.8% at $5.57 a bushel on Monday, while corn is down 0.7% at $4.28 a bushel. Soybean prices fall 0.9% to $10.21 a bushel.

SOFT COMMODITIES: Agricultural softs have given a mixed performance over the past week, with cocoa and coffee recording gains, and sugar making small losses--though prices still remain elevated on adverse conditions in key markets, according to market watchers.

The latest data showed powerhouse producer Ivory Coast reporting increased cocoa shipments in October, adding downward pressure to prices, BMI analysts said in a note on Friday. Cocoa prices have recently been volatile, swinging between daily gains and losses, but are still up more than 78% on year. This reflects diseases and unfavorable weather in Ghana and the Ivory Coast, which together supply more than 60% of the world's cocoa.

Meanwhile, higher sugar output in Brazil has weighed on prices, BMI added.

On Monday, cocoa is up 2.8% at $7,184 a metric ton, while coffee is up 0.8% at $2.55 a pound. Sugar is down 2.4% at 21 cents a pound.

Write to Joe Hoppe at joseph.hoppe@wsj.com

(END) Dow Jones Newswires

November 11, 2024 12:41 ET (17:41 GMT)

Copyright (c) 2024 Dow Jones & Company, Inc.