Ag Market Commentary

Corn futures reacted to the reports as expected, which is to say not at all. The WASDE showed projected ending stocks for the U.S. were unchanged at 1.91 bbu. Brazil Production was estimated at 101 MMT, which was also unchanged. Likewise, Argentina corn production was steady with November at 50 MMT. Corn production from CONAB was up 50,000 MT mo/mo, at 98.41 MMT, but they are still below USDA’s 101 MMT. Yesterday, the USDA released the final crop progress report for the 2019 season, indicating corn harvest had progressed 3 percentage points through the week and was 92% complete as of 12/08; Using the USDA’s forecasted 81.8 million acres of corn to be harvested with the 8% remaining from the crop progress, there remains approximately 6 million acres yet in the field. The UDA put estimates for China corn production at 260.77 MMT to match China’s Bureau of Labor Statistics latest update for 2019 corn production of 260.77 MMT, which is a 2% increase yr/yr.

Dec 19 Corn is at $3.65 1/2, down 1/4 cent,

Mar 20 Corn is at $3.75 3/4, unch,

May 20 Corn is at $3.81 1/2, up 1/4 cent,

Jul 20 Corn is at $3.86 1/2, up 1/2 cent,

---provided by Brugler Marketing & Management

Front month bean futures are up by 1 cent following the release of USDA reports. Soybean meal futures are unchanged, while soybean oil futures are up 18 points. Estimates ahead of the WASDE report indicated a slight reduction was expected to the U.S. carryover, but the WASDE reported 19/20 carryout was UNCH at 475 mbu. USDA did reduce the expected cash average price for this year to $8.85 from $9.00. As for the world bean numbers, Brazil production was also firm, forecasted again at a record 123 MMT. Argentina was also UNCH from November’s estimate at 53 MMT. The USDA estimates 2019/20 world bean ending stocks at 96.4 MMT, which is up from last month. Soybean production from CONAB was up ~200,000 mo/mo, AT 121.1 MMT. China’s National Bureau of Labor Statistics reported soybean production at 18.1 MMT, following a reported 11% uptick in area planted. USDA adopted that increase, and boosted expected Chinese ending stocks by the same 1 MMT.

Jan 20 Soybeans are at $8.98 1/4, up 1 cent,

Mar 20 Soybeans are at $9.12 3/4, up 1 cent,

May 20 Soybeans are at $9.26 1/2, up 1 cent,

Jul 20 Soybeans are at $9.39 1/4, up 1/2 cent,

Dec 19 Soybean Meal is at $296.70, unch,

Dec 19 Soybean Oil is at $31.54, up $0.18

--- provided by Brugler Marketing & Management

The wheat market is showing a little life, with the actively traded (non-December) futures up 3 to 6 cents. The WASDE Report showed a decrease of 40 mbu to U.S. wheat carryover. The adjustment came from a decrease to imports vs. November, as well as a 25 mbu increase to wheat exports from the previous estimate. Ending stocks were lower than trader expectations at 974 mbu. World ending stocks were 1 MMT higher than the November forecast; at 289.5 MMT. The USDA revised Aussie wheat forecast to 16.1 MMT a 1.1 MMT reduction from Nov estimate and 1.2 MMT lower than last year. Private estimates yesterday had called for a cut to 14.97 MMT, but the USDA folks weren’t willing to go that low with harvest still underway. USDA increased their wheat production estimate for 2019 to 133.59 MMT, which was up 1.6% yr/yr.

GASC (Egypt) issued an international wheat tender for early February delivery. Results are expected this afternoon; so far France holds the lowest offer – no US offer. Japan is looking for 171,045 MT of wheat – with 85,8095 MT from U.S and the remainder sourced from Canada and Australia.

Dec 19 CBOT Wheat is at $5.35 1/2, up 3 1/2 cents,

Dec 19 KCBT Wheat is at $4.11 1/2, unch,

Dec 19 MGEX Wheat is at $4.97, unch,

--- provided by Brugler Marketing & Management

Live cattle futures are down so far at midday. Dec futures are in deliveries with a 15-cent decrease. Feeder cattle futures are up at midday, with gains of 62 to 77 cents in the font months. The 12/06 CME Feeder Cattle index was $143.48 lower by $1.01. Wholesale boxed beef prices are lower. Choice boxes were 50 cents lower this morning at $223.14. Select boxes dropped by $1.21 at $205.28. Tomorrow’s online Fed Cattle Exchange will offer 1068 head, with 600 head from Nebraska, 253 head from KS and TX offering 215 head. Estimated cattle slaughter under federal inspection starts the week with 121,000 head on Monday.

Dec 19 Cattle are at $120.025, down $0.150,

Feb 20 Cattle are at $124.700, down $0.050,

Apr 20 Cattle are at $125.200, down $0.200,

Jan 20 Feeder Cattle are at $142.150, up $0.625

Mar 20 Feeder Cattle are at $142.975, up $0.700

Apr 20 Feeder Cattle are at $144.925, up $0.775

---provided by Brugler Marketing & Management

Lean hog futures are up so far, with triple digit gains for the nearbys. The last trading day is Friday for December hogs. The 12/06 CME Lean Hog Index was at $58.12, after a 35-cent fall. USDA’s morning pork carcass cutout value was higher, having gained 42.75 on the strength of the primal cuts. All the primal cuts were higher this morning with bellies leading the way on an $8.42 move. USDA’s national average base hog price for 12/10 was up $0.35 to $47.41. The USDA estimated hog slaughter to start the week with 496,000 head. USMCA has been revised in Washington, and with the expected approval in the House next week, is awaiting ratification before the trade agreement originally negotiated in the fall of 2018 will be signed into law; Mexico had already ratified the original agreement and has been abiding by it since June 20th.

Dec 19 Hogs are at $60.100, up $0.100,

Feb 20 Hogs are at $67.775, up $1.075

Apr 20 Hogs are at $74.075, up $1.100

---provided by Brugler Marketing & Management

Cotton futures are 34 to 43 points higher today. US average cotton yield was lowered by 3% to 761 lbs/acre by USDA. The new lower yield pushed production for the 19/20 crop to 19.48 million bales. Cotton is still 1.914 million bales above the 2018 production. The USDA released the December cotton ginning’s report this morning. The report showed up to the month of December, cotton ginning’s are at 12.930 MRB. That is a 9-year high for that date, with the record for the accumulated ginning’s going back to 05/06 MY. The number grew 3.617 MRB through the latter half of Nov. The Seam reported online cotton sales of 36,019 bales on 12/06, at an average price of 59.08 cents per bale. The Cotlook A Index was back above the 75 mark after a triple digit move on 12/09; the index was up 1.45 to 75.35. The weekly AWP was 55.97 cents/lb.

Mar 20 Cotton is at 65.81, up 43 points,

May 20 Cotton is at 66.78, up 38 points

Jul 20 Cotton is at 67.51, up 34 points

Oct 20 Cotton is at 67.42, unch

---provided by Brugler Marketing & Management

Market Commentary provided by:

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

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