Ag Market Commentary

Corn futures are trading 1 to 2 cents lower this morning. They posted gains of 1 to 2 cents on Friday. Dec lost 1.36% on the week due to Thursday’s report. The USDA corn yield estimate has risen +5.9 bpa since the August report. NE (-2) and MI (-1) were the only major producing states that showed a reduction in yield in November’s report. Total export commitments are now 21.67% lower than this time last year, improving 5.19% over the last week. The Buenos Aires Grain Exchange estimates that the Argentina corn crop is 35% planted, up slightly over last week’s 33.9%. The CFTC Commitment of Traders report was delayed until today due to the federal Veteran’s Day observance on Friday.



Soybean futures are currently2 to 2 cents lower to start the week. They settled the Friday session mostly 2 cents higher. December meal was up $2.70/ton, with nearby bean oil down 33 points. The USDA raised the average farm price range for soybeans 10 cents to $8.45 - $10.15, with the midpoint @ $9.30. Soybean export commitments are lagging last year by 12.9%. AgRural estimates that 57% of the Brazilian soybean crop has been planted, but still slower than last year. Abiove expects Brazilian crushers to produce 31% more biodiesel in 2018 to meet an increased blend requirement there. In Argentina, BAGE projects that 12% of the crop is planted, progressing over last week’s 7.2%.



Wheat futures are 4 to 5 cents lower in the HRW and SRW contracts this morning, with MPLS spring wheat down 6 to 7 cents. They were mostly 2 – 5 cents higher in the KC and CBT contracts today, as MPLS was mixed with Dec 1/2 cent lower. Export commitments of all wheat are still 4.6% below last year, but sales were much improved last week and the gap narrowed. The USDA lowered estimated ending stocks for both HRW and HRS, as HRW saw increased export and HRS had higher domestic use. Russia’s production was increased 1 MMT to 83 MMT on Thursday. Lower production in Brazil and Pakistan helped to offset that, along with adding imports to Brazil. Russia is hoping to improve their export infrastructure, with a goal to increase grain exports 50% in the next 3 years to an average of 7.5 MMT/ month.



Live cattle futures posted losses of $1.65 to $1.90 in the nearby contracts on Friday. Feeder cattle futures were steady to 67.5 cents lower, trying to narrow the feeder/fat spreads. The CME feeder cattle index was 39 cents higher at $159.37 on November 9. Wholesale beef prices were mixed on Friday afternoon. Choice was up $1.11 at $213.85, with select boxes $3.79 lower at $194.51. That widened the Ch/Select spread to $19.34. Estimated weekly FI cattle slaughter through Saturday was 623,000 head, 19,000 fewer than the previous week but 8,000 head above the same week in 2016. Total 2017 commitments for US beef exports are still 10.9% above last year, helping to bleed off part of the extra production.



Lean hog futures finished the Friday session mixed, with Dec down 70 cents. December has dropped $5.52/cwt since October 31. The CME Lean Hog Index for 11/8 was down 41 cents to $67.94. The national base hog average was down 17 cents at $59.70. Weekly FI hog slaughter through Saturday was estimated at 2,495,000 head. That is 38,000 head larger than the previous week and 37,000 head above the same week in 2016. The USDA pork carcass cutout value was up 60 cents in the Friday afternoon report.



Cotton futures are currently 16 to 27 cents higher. They were up 33 to 76 points on Friday. The dollar is modestly higher in overseas trading. All upland cotton export shipments for the week of November 2 totaled 124,292 RB, nearly 43.13% over last week but still lagging last year. Total export commitments for upland cotton are now 63% of the USDA full year projection, well above last year’s 45% and the average of 49% for this date. On Thursday, the USDA raised the US average yield 11 lbs/ac to 900 lbs/ac, which would be a record. They also adjusted the average farm price of cotton to a range of 60-66 cents/lb, with a midpoint of 63 cents/lb, up 3 cents from the October estimate. The USDA average world price (AWP) was updated to 61.38 cents/lb, 33 points higher than the previous week. The Cotlook A index for November 9 was 50 points higher to 79.60 cents/lb.






Market Commentary provided by:

Brugler Marketing & Management LLC
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