Most sources suspect the USDA will show the U.S. harvest at near 90% complete vs. 83% last week. Remember, states reported the furthest behind their traditional pace last week where...Kansas -19%, Arkansas -17%, Missouri and North Dakota -11%, Wisconsin -9%, Michigan -8%, Ohio -7%, Iowa and Nebraska -6%, and South Dakota -5%. The question is, how many acres are left in the fields and subject to extreme cold and bad weather?

As for China, there's nothing new on the trade front. Unfortunately, there's some talk and headlines circulating that a major Chinese animal feed maker has now found African Swine Fever in their feed. From what I understand, the disease can survive for several weeks in animal feed, so this could end up being significant if they can't get a lid on it immediately.

Technically, most inside the trade are talking about strong nearby support in the JAN19 contract between $8.40 and $8.60 per bushel. Many seem to think this area can hold until the end of month G20 meeting in Argentina between President Trump and Chinese President Xi. From there it's anyone’s guess? If a trade deal is negotiated and confirmed, there's talk we could see a jump to near $10.00 in the days immediately following. If no deal is made and the trade conflict looks to be longer-term, there's talk inside the trade that U.S. soybean prices could tumble to sub-$8.00 in a matter of days.

On top of this massive geopolitical "wild-card" we also have the unknowns associated with South American weather during the next 60 to 90 days. From what I'm hearing, Brazil now has over 70% planted and running well ahead of schedule. Argentina is extremely wet in some locations and the excessive rains have halted planting and, in some instances, may cause some washout and replants.

As I've said the past several weeks, Washington and Weather are almost impossible to forecast, so we have to do our best to eliminate worst case scenarios. I'm personally giving up a ton of upside potential just to make certain I don't have the bottom fall out of the barrel. Everyone manages their operation and risk differently, but when I'm faced with a risk management decision where I don't feel I have an inside edge or it's somewhat of a coin toss, I tend to error to the side of caution and reference back to my grandfather's, "a bird in the hand is worth two in the bush" commentary. Where certainly not hitting any home runs, or even doubles, but when you add in money from the government's Market Facilitation Program, we can live to play another day. Those who have a lot more cash flow and, in a position, to risk $7 soybeans for $10 soybeans, more power to you, and I tip my hat. 

Keep in mind, not only do we first have to go to $10, but then you probably have to have the insight and intuition to pull the trigger and make the sale at just the right time when it happens. Which I've found is not always that easy... I have puts in place to protect all of my remaining downside risk. If we catch a big rally I will be feathering in sales. As a spec, I'm going to keep my powder dry until we get extremely close to the G20 meeting. I see no reason to get equity chewed up in the interim. The entire bet is going to come down to that meeting and its results. As in horse racing, I like to wait until right before post-time to place my wagers.  

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