This week is relatively light on trading inputs following last week's big WASDE report moves and the U.S. election volatility the week prior. Trading focus is on fundamental inputs - South American weather, U.S. farmer selling, spreads/basis relaxing - as well as record long fund positioning in today's COT report.

China signed the RCEP yesterday - the world's largest free-trade agreement - and this morning Chinese industrial production data came in better than expected (+6.9% y/y), boosting Chinese stock markets and CNY currency. Soybeans, bean oil, and cotton show the highest co-movement to CNY historically. Copper, another China-linked commodity, is at 2yr highs this morning.

Macro data is light this week. Investors see U.S. retail sales on Tuesday and various global manufacturing surveys. No central bank meetings. Focus is on the Covid-19 pandemic and the rocky Trump-Biden transition. Markets are trading with a mild risk-on tone this morning, boosted by positive China sentiment and a weaker U.S. dollar.

The CFTC will release COT data from November 10th later today. This data captures the fund inflows from last week's WASDE rally and will likely show funds +1.0mm contracts long across the ag complex for the first time.

Agriculture price seasonals turn more broadly supportive at the end of the month for oilseed markets (canola seed is an exception), e.g., soybean meal futures have risen 16 out of 18 years the 30 trading sessions starting today (Nov 16th close).

Watch this week:

Fundamentals: Argentina got much-needed moisture this weekend, southern Brazil has rains in the forecast, and farmer selling has softened basis. China demand is firm (strong CNY helps) and grain and oilseed balance sheets remain tight.

Non-fundamentals: Today's holiday-delayed COT report will show record-long fund positioning, with non-commercial traders roughly +360k contracts corn, +220k beans. Watch how prices adjust to today's COT data and watch the path of the U.S. dollar, esp vs CNY and BRL.

Chart of the Week: Chinese markets are rallying following the signing of the RCEP trade deal this weekend and strong industrial production data this morning. Chinese yuan strength has been a positive tailwind for agriculture futures broadly, especially China-linked markets like soybeans, soybean meal, and cotton.

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