Highlights
Yesterday morning, USDA announced the sale of 136,000 mts of 2022 crop soybeans to China. That is rather surprising given they just bought 3+ million mt of Argentine beans at prices $25 below US prices.
What does China know that we don’t? For one thing, they have a good idea how many beans they are going to need between now and when the new crop Brazilian beans become available in late January. Keep in mind, Brazil harvested a 2022 bean crop that was 20 to 25 million less than expected so Brazil will have that many fewer beans to export these next four months. For another, China knows Argentina is done selling beans for a while as in, maybe not until the next harvest.
The Federal Reserve will raise interest rates on Wednesday at 1:15 pm Central. The market has priced an 80% probability of a 75 basis points (¾%) increase and a 56% probability of a 200 basis point increase by year’s end. The market priced a 16% chance the Fed will raise interest rates a full 1% (100 basis points). The Bank of Japan, Swiss National Bank, and Bank of England raised interest rates last week.