Stewart-Peterson Market Commentary

Closing Commentary - December 12, 2017

Top Farmer Midday Update 12-12-17

CORN: Corn futures are up 2-1/2 cents, supported by USDA’s lower-than-expected ending stocks figure of 2.437 bil bu, which is 40 mil bu below the pre-report average. Last month’s figure was 2.487 bil bu. The agency also increased demand prospects from ethanol production to 5.525 bil bu from 5.475 bil in the November report, and left production and exports unchanged. Mar corn is at 3.51-1/2 ahead of contract low support from yesterday’s low of 3.48-1/4. This morning, USDA reported an export sale of corn to Mexico totaling 152,000 tons. S. Korea also bought 136,000 tons of optional-origin corn.

SOYBEANS:Soybean futures reacted negatively to the release of today’s USDA report, but are off their session lows. Mar beans are down 1/2 cent to 9.93-1/2. USDA reported stronger-than-projected competition from Argentina and Brazil prompting lower soybean exports by 25 mil bu for 2017-18 with exports now pegged at 2.225 bil bu. USDA also bumped up projected seed production by 5 mil bu as well. The export and seed changes led USDA to increase soybean ending stocks by 20 mil bu to 445 mil bu for the 2017-18 crop year. That fell right in line with the pre-report average forecast. Weather forecasts this morning are still calling for some better rain chances ahead for Argentina and southern Brazil which are being called by some a ‘needed’ event.

WHEAT:Winter wheat futures are nearly unchanged after today’s report. USDA lowered wheat exports by 25 mil bu for 2017-18 to 975 mil bu. The lower export forecast stems from higher projected export competition from Canada. The net result was increasing wheat ending stocks for the year to 960 mil bu. That comes in at 19 mil bu higher than pre-report estimates. The wheat cash price remains pegged at $4.60 a bushel, but much like corn and soybeans, USDA narrowed the low and high prices for wheat by 10 cents a bushel on each end. USDA did report an export sale of 120,000 tons of HRW wheat to Algeria this morning. S. Korea bought 65,000 tons of option-origin feed wheat.

CATTLE:Cattle futures sharply higher across the board as recent weakness warrants a technical bounce. Feb cattle are up 1.775 to 119.500 after trading lower for the eighth consecutive session on Monday. The contract is trying to stabilize at the contract’s 100-day moving average until this week’s cash trade develops. Apr cattle are up 1.725 to 121.350. Mar feeders are up 1.75 to 145.075.

HOGS:Hog futures remain mixed with a weak tone at mid-session. Nearby Dec hogs, up .250 to 63.850 are consolidating inside Monday’s narrow trading range ahead of that contract’s expiration on Thursday. Feb hogs are down .300 to 66.725, and Apr futures are down .325 to 71.500. Both contracts are at fresh multi-week lows.

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