Ag Market Commentary

Corn futures are trading fractionally lower this morning. They ended the Wednesday session with most nearby contracts fractionally to 1 1/4 cents lower. Wednesday morning’s EIA report showed another record week of ethanol production with 1.108 million barrels per day produced during the week of 12/1. That was 42,000 bpd larger than the previous week, but stocks also increased 500,000 barrels to 22.544 million barrels. US corn exports during the month of October totaled 2.725 MMT, with 1.15 MMT going to Mexico. That was 24.7% lower than last October and down 22.7% from September. Census data shows 93.6 million gallons of ethanol shipped during October, 8% larger than September. DDG exports were also larger than in September. Expectations ahead of the weekly Export Sales report are running 0.8 to 1.2 MMT for 17/18 corn sales.

Soybean futures are currently 7 to 8 cents lower on profit taking selling after also closing Wednesday with 3 to 5 3/4 cent losses. December meal was down 90 cents/ton, with nearby bean oil 32 points lower. Census data shows soybean exports in October at 9.441 MMT, down 15.8% from last year but more than double September’s total. Wednesday morning’s Stats Canada report put Canadian canola production at 21.313 MMT. That exceeded most analysts’ estimates and was an increase of 8.7% from the previous year. The soybean crop was at 7.717 MMT, just short of expectations but 16.6% larger than 2016 production. Analysts are expecting this week’s USDA Export Sales report to show bearish sales of 1-1.5 MMT for 17/18 soybeans.

Wheat futures are fractionally higher in KC HRW this morning, but fractionally lower in CHI and MPLS this morning. They saw most contracts 5 to 8 1/4 cents lower on Wednesday, with a few MPLS contracts down as much as 12 1/2. The US dollar is stronger this morning. Trade data from the month of October shows the US shipped 1.393 MMT of wheat. That was down 19.64% from last month and 40.94% lower than the same time last year. Wednesday morning’s report from Stats Canada showed the country’s 2017 total wheat production hit 29.984 MMT. That was down 5.5 % from last year but exceeded the average projection of 28 MMT. Durum wheat was also reported higher than expectations at 4.962 MMT, down 36.1% from a year ago. All wheat weekly export sales are estimated to run 250,000-450,000 MT in this morning’s USDA report.

Live cattle futures finished the Wednesday session with 52.5 cents to $1.275 losses. Feeder cattle futures were down $1.65 to $2.075. The CME feeder cattle index on December 5 was down 29 cents to $156.11. Wholesale boxed beef values were sharply lower on Wednesday afternoon. Choice was down $2.68 at $206.40, with select $2.52 lower at $184.11. Estimated WTD FI slaughter was at 358,000 head through Wednesday, 1,000 above last week and 15,000 head larger than the same week last year. The online FCE auction again showed no sales as 2 offers were passed by feedlots at $117.25 and $117.50. There were a few cash trades of $117 to $118.5 on Wednesday. US export trade data from October shows a record for that month at 259.996 million pounds of beef shipped. That is 13.6% larger than a year ago and 7% above September.

Lean hog futures were 22.5 cents to $1.55 in the red on Wednesday. The CME Lean Hog Index for 12/4 was up 43 cents to $64.35. The USDA pork carcass cutout value was $2.03 lower at $82.75 in the Wednesday afternoon report. The belly and rib were the only cuts reported higher. The national base hog price was 22 cents lower at $59.28. The IA/MN region cash hog average was 51 cents lower, with the WCB down 48 cents. The USDA FI hog slaughter was estimated at 1,395,000 head through Wednesday. That is up 31,000 head from the previous week and 76,000 head more than last year. US pork exports during October were a record 494.643 million pounds for the month. That was 9.6% larger than October 2016 and a 17.4% jump from the September Census report.

Cotton futures are 50 to 52 points lower. They settled the Wednesday session with most contracts steady to 21 points higher. December expired 21 points higher at 75.17 cents/lb. During October, the US shipped 97,302 MT of cotton for export. That was a drop of 21.5% from the previous month and 22.5% lower than last October. The USDA Export Sales report is generally expected to show a slowdown in upland cotton sales this morning. Online cash sales dropped to 13,670 bales reported on the Seam, as prices rose 46 points to 69.46 cents/lb. The Cotlook A index was down 70 points on December 5 to 82.95 cents/lb.

Market Commentary provided by:

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