Ag Market Commentary

Corn futures are 1 to 1 3/4 cents lower this morning on year end position squaring. Trader ideas for the USDA weekly Export Sales report were too conservative at 0.6-1.1 MMT, with 0-50,000 MT seen for new crop. The USDA indicated old crop corn export sales of 1.245 MMT for the week ending December 21 in this morning’s Export Sales report, with another 102,900 MT sold for 2018/19 crop delivery. The market needs a lot more weeks like that to exceed the current WASDE forecast. Argentine corn planting progress is catching up to last year at this time, although still behind the 3 year average pace. Earlier delays will result in some maturity lag unless the heat units pick up.

Mar 18 Corn is at $3.50 3/4, down 1 1/4 cents,

May 18 Corn is at $3.59, down 1 1/4 cents,

Jul 18 Corn is at $3.67 1/2, down 1 1/2 cents

Sep 18 Corn is at $3.75, down 1 1/2 cents

Soybean futures are trading 2 to 4 cents higher at midday. January soybean meal is 40 cents higher. Soy oil is up 55 points on a bullish export sales week featuring 44,200 MT in new sales. Soybean old crop export sales are expected to be in the range of 0.8-1.5 MMT, with soy meal @ 100,000-300,000 MT. This morning’s USDA Export Sales report showed 17/18 soybean export sales of 974,700 MT for 2017/18 delivery, with another 81,300 MT for 2018/19. Meal sales were on the higher end of expectations at 288,300 MT and topped the 300,000 MT mark when you throw in 17,600 MT booked for next year. Port workers and processing workers remain on strike at Rosario, Argentina following the fatal explosion on Wednesday at a COFCO facility there.

Jan 18 Soybeans are at $9.51, up 5 1/4 cents,

Mar 18 Soybeans are at $9.61 1/2, up 4 3/4 cents,

May 18 Soybeans are at $9.72 1/2, up 4 3/4 cents,

Jul 18 Soybeans are at $9.83, up 4 1/4 cents,

Jan 18 Soybean Meal is at $312.20, up $0.40,

Jan 18 Soybean Oil is at $33.05, up $0.55

Wheat futures are lower in all three markets despite the severe cold expected in the central US this weekend amid a lack of snow cover. Areas with little or no snow cover could be at risk of winter kill. That said, winterkill is notoriously difficult to quantify ahead of the crop breaking dormancy in February, and the Russians and Aussies have plenty available for sale. Analysts were expecting to see 250,000-550,000 MT in all wheat export sales of old crop during the week of 12/21. This morning, USDA indicated all wheat export sales for the week ending 12/21 were on the low side at 478,400 MT, with another 62,100 MT for 2018/19 delivery.

Mar 18 CBOT Wheat is at $4.26 1/4, down 1 1/2 cents,

Mar 18 KCBT Wheat is at $4.26 1/2, down 1/4 cent,

Mar 18 MGEX Wheat is at $6.16 1/2, down 2 1/2 cents

Live cattle futures are mostly 12 to 67 cents higher, led by the expiring December contract as it converges with the presumed cash market. Feeder futures are 7 to 35 higher. The CME feeder cattle index on December 27 was down $2.48 to $145.88. Wholesale boxed beef values are higher, with choice boxes up $1.01 and select boxes up $1.29/cwt from Thursday. Estimated week to date FI cattle slaughter was 328,000 head through Thursday. That is 26,000 head fewer than the same week last year. Cash trade has been slow to develop this week, with bids of $119.50 and asks of $125. There have still be zero deliveries against December futures, with the oldest long dating back to November 1. The USDA weekly Export Sales report showed 2017 beef export sales of 9,100 MT (to be shipped by December 31), with 9,100 MT sold for 2018.

Dec 17 Cattle are at $125.175, up $0.625,

Feb 18 Cattle are at $121.950, down $0.300,

Apr 18 Cattle are at $122.925, up $0.175,

Jan 18 Feeder Cattle are at $145.775, up $0.175

Mar 18 Feeder Cattle are at $142.425, up $0.200

Apr 18 Feeder Cattle are at $142.825, up $0.150

Lean hog futures continue to rally into year end, with gains of 10 to 50 cents this morning fading into UNCH to 20 higher at midday. The CME Lean Hog Index for 12/27 was down 1 cents to $61.58. The USDA pork carcass cutout value was up 23 cents at $78.26 this morning, with hams the strongest component. The national base hog price is 53 cents higher at $58.46 this morning. The USDA weekly FI hog slaughter was estimated at 1,287,000 head through Thursday. That is down 39,000 head from the same week last year. USDA reported pork export sales for 2017 of 16,600 MT this morning, with 2018 sales for the week ending December 21 at 14,400 MT. Russia has confirmed an outbreak of H5N2 avian flu, with more than 660,000 birds culled thus far as a preventative measure.

Feb 18 Hogs are at $71.875, up $0.325,

Apr 18 Hogs are at $75.775, up $0.075

May 18 Hogs are at $80.200, up $0.125

Cotton futures are trading 24 to 36 points lower at midday, but firmer than they were overnight. March futures matched their life of contract high yesterday. The weekly USDA Export Sales report was expected to slow down from last week’s 326,520 RB and it did. Weekly sales totaled 163,700 RB for upland and 12,800 RB for old crop pima. There were another 32,500 RB of upland varieties sold for 2018/19 shipment. The USDA Adjusted World Price (AWP) was increased 262 points to 70.62 cents/lb on Thursday. It is a long way above loan rate!

Mar 18 Cotton is at 78.44, down 36 points,

May 18 Cotton is at 78.63, down 25 points

Jul 18 Cotton is at 78.81, down 24 points

Market Commentary provided by:

Brugler Marketing & Management LLC
1908 N. 203rd St.Omaha, NE 68022
Phone: 402-697-3623
Fax: 402-289-2353

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