BQC Afternoon Comments Sept 20.24

Macroeconomics:

The East coast, including the Gulf of Mexico, is preparing for a work stoppage strike among the International Longshoreman’s Association (ILA) set to begin October 1st if terms are not met or the US government does not intervene. The ILA and the US Maritime Alliance started to fall out of pocket over the summer, and we are now starting to see a shift in the cargo bookings on both sides of the country in anticipation of the stoppage. California’s ports are seeing an uptick in action with this last August being the busiest month in the Port of Long Beach’s history. Boats in route to the east coast, where 5 of the 10 busiest ports in North America are subject to shut down, are anticipating the event and preparing to slow transit times, reroute, or anchor down and wait for the green light. The Biden administration has said they will not invoke powers to force union members to go back to work. The negotiations are over wages and automation. Keep in mind the holiday season is only a few months away and halting these shipments could disrupt the supply chain leading up to a very busy time of year.

Ag Fundamentals:

US Farmers are actively cutting both corn and bean crops heading into a weekend of weather that could slow Illinois harvest slightly. This last Monday the USDA reported US harvest at 9% Corn and 6% beans, I expect corn harvest progress to at least double, closer to 20% harvested when they update progress next week. Beans will be reported close behind at 15-18% harvested or more. The drier than normal weather the US has seen over the last 60 days is drying out this year’s crops faster than normal. Yields in the mid-south and southern Midwest are in line with expectations. Indiana and Ohio are bullseyes on the drought monitor this week. Both states combined make up just over 10% of both US corn and bean productions.

Weather:

Illinois and western Indiana is expecting storms to roll in from west to east this Sunday into Monday. Southern Iowa, and northern Missouri will also see rainfall over the weekend. The soil moisture along this storms forecasted track will benefit from the precipitation. River levels on the lower Mississippi are expected to remain in a sub-full draft scenario until late October. Brazil’s forecast models are improving rainfall for October, allowing for planting to get under way in the Central West region.