Ag Market Commentary

Corn futures are currently 2 cents higher after settling 2 to 3 3/4 cents lower on Wednesday. Estimates ahead of this morning’s Export Sales report are showing 0.7-1.1 MMT in old crop corn sales, with 100,000-250,000 MT in new crop sales. The weekly EIA report showed that 1.028 million barrels per day of ethanol production in the week that ended 5/18. That was a 30,000 bpd drop from the previous week. Ethanol stocks grew to 22.129 million barrels, up 624,000 barrels from the week prior despite the reduced production.

Soybean futures are trading 6 to 6 cents higher this morning. They saw 8 to 9 1/2 cent gains in most contracts on Wednesday. Soymeal were up $3.20/ton, with front month soy oil 19 points higher. The average trade guess for old crop soybean export sales is for net reductions of 200,000 to sales of 400,000 MT. There were some large cancellations announced previously. New crop sales are seen at 200,000-400,000 MT. Soy meal sales are expected at 100,000-500,000 MT, with soy oil at 8,000-30,000 MT. Ports in Argentina are expected to be shut down today due to a strike. Brazil is still seeing trucking disruptions, encouraging China to look back toward the US.

Wheat futures are 2 to 8 cents higher this morning, with the most price movements in the nearby Chicago SRW contracts. They posted gains of 9 to 11 1/4 cents in most contracts on Wednesday. Rains pushing their way through the Northern Plains are slowing any planting that is left in the area. The 6-10 day outlook shows warmer temperatures on the way for most of the Plains over the next week, providing a little support for the drought stressed HRW. Analysts are looking for net reductions of 100,000 MT to sales of 100,000 MT for old crop wheat export sales during the week of 5/17. New crop sales are expected to be in the range of 100,000-400,000 MT. That would be an improvement over last week’s total sales of 193,738 MT.

Live cattle futures closed $1.20 to $1.90 higher, though June was up 55 cents while waiting for cash market indications. Feeder cattle futures saw gains of $1.925 to $2.625, with May up 95 cents (it expires today). The CME feeder cattle index was up 2 cents on May 22 at $133.43. Wholesale boxed beef values were mixed on Wednesday afternoon. Choice boxes were up 73 cents at $230.08, with Select boxes 82 cents lower at $205.04. Week to date FI cattle slaughter was estimated at 358,000 head through Wednesday. That is 4,000 head larger than last week. Analysts are expecting to see April feedlot marketings at an average of 1.805 million head, which is 6% larger than the same month last year. The Cattle on Feed report is scheduled for Friday morning at 11 AM CDT. None of the 225 head offered on FCE’s online auction were sold on Wednesday. A few low ball bids of $108 and $175 have been reported in NE so far on Wednesday, with no sales yet.

Lean hog futures were 67.5 cents to $1.475 in the green on Wednesday, ignoring the bearish Cold Storage stocks data. The CME Lean Hog Index was up 33 cents from the previous day to $68.69 on May 21. The USDA pork carcass cutout value was down $1.33 at $74.81 on Wednesday afternoon. The national base hog weighted average price was 4 cents lower at $64.73 in the afternoon. The USDA estimated weekly FI hog slaughter at 1.374 million head through Wednesday. That is down 6,000 head from last week but 48,000 above the same week in 2017.

Cotton futures are trading 40 to 100 points higher this morning. They finished the Wednesday session mixed. Nearby July was down 39 points, with other contracts higher. The US dollar index was up 360 points, causing a little pressure for July. The weekly Export Sales report will be released at 7:30 am CDT this morning. China sold another 30,000 MT of cotton offered at an auction of state reserves on Wednesday. The Cotlook A index was up another 145 points from the previous day to 95.90 cents/lb on May 22. The current AWP of 74.09 cents/lb will be updated on Thursday.

Market Commentary provided by:

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