Ag Market Commentary

Corn futures closed Tuesday with most contracts 3 1/2 to 6 cents lower but Dec did finish 6 cents off the intraday low. In the USDA supply and demand report, the US corn yield was raised 0.4 bpa to 169.9 bpa, running against most trade expectations. This caused production to jump 31 mbu to 14.184 bbu. The US 17/18 ending stocks number was increased 62 mbu to 2.335 bbu, while old crop ending stocks dropped 20 mbu to 2.35 bbu. Exports for 16/17 were increased 70 mbu to 2.295 bbu, with corn used for ethanol down 15 mbu. On the world side of things, the USDA shifted 17/18 world ending stocks +1.6 MMT to 202.47 MMT.

Sep 17 Corn closed at $3.40, down 5 1/2 cents,

Dec 17 Corn closed at $3.51 1/2, down 6 cents,

Mar 18 Corn closed at $3.63 3/4, down 6 cents

May 18 Corn closed at $3.72, down 5 3/4 cents

Soybean futures settled 7 1/2 to 10 1/2 cents in the red following this morning’s September WASDE report. Sept soy meal was down $3.80/ton, with nearby bean oil 5 points higher. A private export sale of 132,000 MT to Unknown Destinations for 17/18 was announced this morning through the USDA’s daily reporting system. The USDA adjusted their 2017 US national soybean yield up 0.5 bpa to 49.9 bpa. NASS increased production 50 mbu to 4.431 mbu with harvested acreage change deferred until October. Old crop ending stocks were trimmed 25 million bushels on a 45 mbu increase in exports. New crop US ending stocks were unchanged from the August report at 475 mbu. World ending stock for 17/18 shifted down just 0.25 MMT to 97.53 MMT.

Sep 17 Soybeans closed at $9.44 1/4, down 10 1/2 cents,

Nov 17 Soybeans closed at $9.50 1/2, down 9 1/2 cents,

Jan 18 Soybeans closed at $9.60 3/4, down 9 1/4 cents,

May 18 Soybeans closed at $9.78 1/2, down 8 3/4 cents,

Sep 17 Soybean Meal closed at $295.10, down $3.80,

Sep 17 Soybean Oil closed at $34.84, up $0.05

Wheat futures finished the Tuesday session with most contracts higher, as nearby MPLS contracts were steady. The US supply and demand table was left unchanged for 17/18, with production at 1.739 bbu, and ending stocks at 933 mbu. They are waiting on the September 29 Small Grains report for data. World wheat ending stocks for new crop was adjusted to 263.14 MMT, a 1.55 MMT drop from August. Russian production was increased 3.5 MMT to 81 MMT, while Australian and EU production ideas were reduced. Japan is seeking 139,382 MT of wheat from Australia, Canada and the US in their weekly MOA tender. It calls for 55,645 MT of US wheat, with the tender to close Thursday.

Sep 17 CBOT Wheat closed at $4.19 1/2, up 7 1/4 cents,

Sep 17 KCBT Wheat closed at $4.16, up 6 3/4 cents,

Sep 17 MGEX Wheat closed at $6.26 1/4, unch,

Live cattle futures ended the Tuesday session with most contracts 35 cents to $1.325 lower. Feeder cattle futures were down a nickel to 50 cents. The CME feeder cattle index was down 4 cents from the previous day at $148.97 on September 11. Wholesale beef prices were mixed in the Tuesday afternoon report, with the Ch/Se spread flipping to the negative side. Select is now showing a 7 cent premium giving feeders little incentive to finish longer than needed. Choice was down 77 cents at $190.79, as select boxes were 48 cents higher at $190.86. FI cattle slaughter was estimated at 233,000 head through Tuesday, which is 10,000 head larger than the same week in 2016. Wednesday’s FCE online auction will show 1,063 head for sale, with a majority from KS. In this morning’s USDA supply and demand table, beef production for 2017 was lowered 140 million pounds to 26.559 billion pounds.

Oct 17 Cattle closed at $106.275, down $0.925,

Dec 17 Cattle closed at $111.550, down $1.325,

Feb 18 Cattle closed at $115.250, down $1.300,

Sep 17 Feeder Cattle closed at $147.975, down $0.475

Oct 17 Feeder Cattle closed at $149.150, down $0.200

Nov 17 Feeder Cattle closed at $149.250, down $0.050

Lean hog futures were 40 cents to $2.125. The CME Lean Hog Index for 9/8 was $1.02 lower than the previous day at $67.92. Packer submission issues caused the USDA pork carcass cutout value to be delayed. It was $1.74 lower in the Tuesday morning report, with a weighted average of $80.34. The national base hog carcass was down $1.17 in the PM report at 55.99. Estimated FI hog slaughter was 901,000 through Tuesday, 22,000 larger than the same week in 2016. Estimated annual pork production for 2017 was raised 35 million pounds by the USDA this morning to 25.841 billion pounds.

Oct 17 Hogs closed at $59.450, down $2.125,

Dec 17 Hogs closed at $57.100, down $1.525

Feb 18 Hogs closed at $62.725, down $0.950

Cotton futures posted limit losses in the nearby contracts. There will be expanded limits tomorrow. The USDA raised the 2017 US cotton yield 16 lbs/ac to 902 lbs/ac in this morning’s supply and demand report. Average yields were raised in all states except CA, AR and GA. US 2017 production rose 1.21 million bales to 21.76 bales. US new crop ending stocks rose 0.2 million bales to 6 million bales. World ending stocks for 2017/18 jumped 2.45 million bales to 92.54 million bales. India, Brazil, and Australian production was raised along with the US. The Cotlook A index for September 11 was35 points higher at 84.4 cents/lb.

Oct 17 Cotton closed at 70.710, down 300 points,

Dec 17 Cotton closed at 69.110, down 300 points

May 18 Cotton closed at 69.060, down 270 points

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