AgriCharts Market Commentary

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Corn

Corn futures are currently 1 to 2 cents higher after finishing fractionally to 2 1/2 cents lower on Wednesday. Showers were rolling across the Corn Belt on Wednesday. Analysts with Lanworth are estimating the 2017/18 corn crop at 13.6 bbu, down 4% from their previous estimate. The market is waiting to see if the acreage assumption in that number is stable, with USDA out on Friday at 11 am CDT. EIA daily ethanol production for the week of June 23 was 25,000 barrels per day higher than the previous week at 1.015 million bpd. That is the largest wk/wk increase since October 2016. Ethanol stocks also shrank to the lowest point in almost five months @ 21.838 million barrels. The East Coast and the Rockies were the only regions to see an increase. Estimates ahead of today’s export sales report are running 350,000-550,000 MT for old crop, with 100,000-300,000 MT for new crop weekly sales.

Soybeans

Soybean futures are mostly 5 to 6 cents higher this morning after closing with gains of 2 3/4 to 4 1/4 cents on Wednesday. July 17 soy meal was up 60 cents, with soy oil 4 points higher in the front month. Traders are expecting 200,000-400,000 MT for old crop sales in this morning’s export sales report, as new crop is projected at 100,000-300,000 MT. Total soy meal sales are estimated at 50,000-200,000 MT, with soy oil in the 5,000-29,000 MT range. Lanworth increased their 2017/18 soybean production estimate to 4.07 bbu, up 1% over their last estimate. Abiove updated their 2016/17 Brazilian production estimate to 113.2 MMT, 0.7 MMT above their previous estimate. They also increased their Brazilian annual export projection to 63 MMT (2.314 billion bushels!), up 1.3 MMT (+47.8 mbu).

Wheat

Wheat futures are trading 8 to 9 cents higher this morning in KC and Chicago. Runaway bull Minneapolis spring wheat is up another 23 to 26 cents per bushel. MPLS spring wheat carried the weight yesterday as well, up 23 1/4 cents in nearby July and hitting new multi-year highs. Elevators are firming HRW basis in order to capture the grain for storage hedges. The trade is projecting 2017/18 export sales will be 350,000-550,000 in Thursday’s USDA weekly export sales report. Last week beat expectations of 500,000 MT at 542,881 MT. Temperatures are cooling off slightly in Western Europe, with Russia and Ukraine still experiencing warmer temps

Cattle

Live cattle futures came back to show gains of 60 cents to $1.10 in most contracts on Wednesday. Feeder cattle futures also finished 60 cents to $2.10 higher. The CME feeder cattle index was up 44 cents on June 27 at $146.86. Wholesale beef prices were sharply lower again in the Wednesday afternoon report, with choice boxes down $4.48 at $229.43. Select was $2.59 lower, with an average of $212.67. The Ch/Se spread is now down to $16.76. Estimated FI cattle slaughter through Wednesday was 350,000 head, 1,000 above last week and 11,000 greater than last year. Trade on the FCE showed cash sales of $119-$120 on 3 lots, as 480 of the 2,554 head were sold. The average price on all lots sold was $119.68. Outside of the FCE there were a few dressed sales of $190-$191 in the North.

Lean Hogs

Lean hog futures were 52.5 cents to $1.45 higher in the front months, with deferred contracts 2.5 to 47.5 cents lower. The CME Lean Hog Index for 6/26 was up another 48 cents to $91.10. The USDA pork carcass cutout value was up $1.23 in the afternoon report, with a weighted average of $103.54. All primal cuts except the ham were higher. The national base hog carcass price was 22 cents lower with a weighted average of $85.59 in the p.m. report. FI hog slaughter was estimated at 1,308,000 head through Wednesday, 17,000 more than the previous week and 25,000 head above last year. USDA’s Hogs and Pigs report will be released at 2:00 p.m. CST, with analysts expecting the March-May pig crop to rise 3% over last year, with pigs per litter 1.3% larger and the sow more than than 1% larger.

Cotton

Cotton futures settled 3 to 28 points lower on Wednesday, and are 20 to 60 points lower this morning. The US dollar was down 349 points yesterday, but currency effects are muted during the main growing season. Analysts are projecting a second week of strong export sales, heavily skewed to new crop delivery. The certified stocks level for July futures deliveries dropped another 63,131 bales to 314,986 bales, after yesterday’s 111,040 bale plunge. China sold 19,700 MT of cotton from state reserves on Wednesday, totaling 66.23% of the total 29,800 MT offered. The Presidents of the Cotton Association in India is estimating cotton production in the country could hit 29.3 million bales, compared to the USDA projection of 28 million bales.


Market Commentary provided by:

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