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-Argentine election goes as expected as market awaits changes in grain export tax rules
-USDA reports modest SBM sales, no soybeans
-Good harvest activity in west, but expected to slow this week while east plods along
-First winter wheat conditions this afternoon

 Argentina’s election over the weekend went as expected with incumbent Mauricio Macri losing the Peronist party’s Alberto Fernandez and marking the political comeback of past president Cristina Fernandez de Kirchner as soon-to-be vice president. Following the results of the election, Argentina’s central bank issued strict currency rules limiting the amount U.S. dollars allowed to be purchased by individuals to just $200/month vs the previous limit of $10,000/month amid fears of a significant loss of foreign exchange. Under Cristina Kirchner’s presidency, Argentine grain exports were heavily taxed, while also seeing exportable quantities limited by quotas, limiting the desire to expand area/production. Under Macri, as taxes were rolled back and quotas removed, corn area increased 65%, while production rose more than 70% over the last three years, while soybean area declined nearly 15% during the same period, as roughly 3 million hectares (7.4 mil acres) were pulled from soybeans and shifted mostly to corn, while wheat area/production also saw a considerable increase in recent years, as well. Early ideas on potential/likely changes to the ag export tax picture under the new presidency are for the soybean export tax to rise to 35% from 25% currently and the corn and wheat tax to rise to 10% from 7% currently, while export quotas are not expected to be re-instituted, but there has been some uncertainty expressed until a definitive statement from Fernandez is made.

 USDA reported the sale of 135k tonnes of soybean meal to the Philippines for 2019/20 delivery, but no soybean sale announcements were made this morning.

 SovEcon ticked their estimate of October Russian wheat exports lower again to 3.2 MMT from 3.3 MMT previously and is down from 4.1 MMT in Sept and 4.45 MMT last year October. July-Oct cumulative exports of 15.0 MMT compare to 17.5 MMT last year.

 Ideas on corn harvest this afternoon appear to be around 46-48% (30% last week) with soybean harvest seen around 64-65% (46% last week) with activity extremely aggressive late last week and over the weekend in the west. Heavy central/eastern belt rains over the weekend will keep harvest slow/limited for the time being. The first winter wheat crop condition ratings of the season will be out this afternoon, with last year’s late October rating being 53% good/excellent and the most-recent 5-year average being 54% g/e.

 Phase One of the U.S./China trade deal continues to make progress with both sides indicating they are nearing crossing t’s and dotting i’s with a hopeful signing in Chile in mid-November.

 First notice day for November soybean deliveries is Thursday with ideas appearing to be around 1,000-1,500 contracts being issued.

 Friday’s CFTC data showed funds next sellers of 10k contracts of corn for the week ended 10/22/19 and are net short 76.1k, and net sellers of 2.5k KCBT wheat (net short 25.9k), but were net buyers across the rest of the ag complex. Funds were net buyers of 19.8k soybeans (68.8k contracts), 22.7k CBOT wheat (net long 12.1k), 24.2k SBO (net long 67.6k), 3.9k SBM (net short 21.2k), and 1.5k MPLS wheat (net short 8.1k).

Weather Light rains/snow are expected across much of IA, WI, NW MO and northern IL later tonight and into tomorrow. More significant precip is expected Wednesday into Thursday activity starting as rains of .50-1.5” for IA, MO, IL, SE 1/3 of WI, IN, MI, and OH, with the backside of the system switching to snow with 3-7” expected for the eastern ½ of IA, northwestern ¼ of IL and much of WI later Thursday into Thursday night. Conditions turn quiet over the weekend/early next week, followed by mixed views again as the European shows of another system to bring light to moderate rains to much of the region the middle of next week, while the GFS is keeping things mainly dry into the middle of next week. Below average temps are expected across the belt for the next 10 days. Rains of .50-1.5”+ will fall across the Argentine growing regions from northern Buenos Aries north, as well as into the southern Brazilian growing states of RGDS, Santa Catarina and Parana in the next 5 days. Totals in the rest of the Brazilian growing regions look to be generally less than .35”,with coverage of around 55%. The 6-10 day period sees dry weather for most of the Argentine growing regions, with rains of .50-1.5”+ to fall in most of the Brazilian growing regions.

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