AgriCharts Market Commentary

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Corn

Corn futures are trading 1 to 2 cents lower this morning. They posted 4 to 5 cent losses in most contracts on Friday, as July expired at $3.30 1/4. Friday’s CFTC Commitment of Traders report indicated that the spec managed money net short position grew by 33,566 contracts. In the week that ended July 10, their net position in corn futures and options was -104,376 contracts. The USDA trimmed their new crop cash price midpoint estimate by 10 cents to $3.80. A Chinese auction of state reserves saw 942,336 MT of corn sold, totaling 23.45% of the amount offered on Friday.

Soybeans

Soybean futures are currently 2 to 3 cents below their Friday close. They ended Friday with 14 to 16 cent losses, with old crop August down 6.7% for the week. Nearby soy meal was down $4.60/ton, with soy oil 37 points in the red. Traders are looking for today’s NOPA report to show 159.64 mbu of soybeans crushed in June, which would be 15.6% larger than last year. NOPA soy oil stocks are seen at an average 1.807 billion pounds. Thursday’s WASDE showed USDA adding another 15 mbu to 17/18 crush to a record 2.03 bbu, with 18/19 crush up 45 mbu from June at 2.045 bbu. Safras & Mercado expects 2018/19 Brazilian acreage for soybeans to jump 2.3% from last year, to ~88.958 million acres, while USDA projects Brazil production at 120.5 MMT.

Wheat

Wheat futures are trading 4 to 7 cents lower this morning, with most 4 lower. They saw 8 to 12 1/2 cent gains in most CBT and KC contracts on Friday, with MPLS a penny on either side of UNCH. September CBT wheat was down 3.54% on the week, with KC losing 4.14% and MPLS 4.75% lower. USDA individual wheat by class data projects HRW ending stocks for 2018/19 decreasing by nearly 164 mbu to 417, while HRS is seen jumping from this year’s drought depressed 92 to 283 mbu. The Rosario Grain Exchange updated their 2018/19 wheat production estimate for Argentina to 20 MMT, which would be a record if realized. Russia’s Ag Ministry projects that the country will produce 64.4 MMT of wheat in 2018/19, vs. the USDA’s newly updated 67 MMT.

Cattle

Live cattle futures settled with most contracts 17.5 to 47.5 cents lower on Friday. Feeder cattle futures were mixed, with August down 30 cents and back months slightly higher. The CME feeder cattle index was up $1 from the previous day at $148.16 on 7/12. Wholesale boxed beef values were lower again on Friday afternoon. Choice boxes were down a sharp $2.44 to $204.14, while Select boxes were 64 cents lower at $196.37. Weekly FI cattle slaughter was estimated at 650,000 head, up 26,000 from the same week last year. Cash bids crept up to $110 on Friday, with some confirmed trades at $109.50 and $175 in the north. The USDA trimmed the top end of the range for 2018 average price by $1 to $114-117.

Lean Hogs

Lean hog futures ended the Friday session with the front months steady to 27.5 cents lower and back months up triple digits. The USDA pork carcass cutout value was up 31 cents on Friday afternoon at $83.82. The CME Lean Hog Index was down 26 cents on July 11, to $81.26. The national base carcass price was down 86 cents on Friday, reported at $74.19. USDA estimated weekly FI hog slaughter at 2.285 million head including Saturday, 88,000 head above last year.

Cotton

Cotton futures are 19 lower to 42 higher this morning, with only front month October in the red. They showed losses of 34 to 73 points in all the front months on Friday, due mostly to pre-weekend profit taking. The US dollar index is weaker in overseas trading ahead of the US open. USDA’s old crop export projection for US is now at 16.2 million bales, with new crop dropping 500,000 bales to 15 million. Thursday’s WASDE showed a jump in the average cash price for 18/19 to a range of 68-82 cents/lb. CFTC’s Cotton on Call report showed December’s unfixed call sales position at 52,212 contracts on July 6, down 1,574 from the week prior. Safras & Mercado estimates that Brazil’s cotton planted acreage will rise by 10.8% in 18/19. The Cotlook A index was down 2 cents to 94.45 cents/lb on July 12. The weekly USDA AWP was updated to 76.17 cents/lb through next Thursday, up 1.58 cents from the week prior. Speculators in cotton futures and options added 1,975 contracts to their net long position as of Tuesday to a net position of 77,274 contracts.


Market Commentary provided by:

Brugler Marketing & Management LLC
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