Ag Market Commentary

Corn futures are currently 1 to 1 cents higher after closing with fractional to 1 1/2 cent losses on Wednesday. Wednesday morning’s weekly EIA report indicated ethanol production for the week of September 29 had increased 14,000 barrels per day to 1.01 bpd. That is good for corn use. Total corn use for ethanol was 5.44 billion bushels last year, according to the Grain Crushings report. Ethanol stocks for that week also jumped 805,000 barrels to 21.545 million barrels, with a bulk of that number coming on the East Coast. The USDA export sales report released later this morning has traders expecting 500,000-700,000 MT in 17/18 corn sales for the week ending 9/28. Last week’s sales fell to a marketing year low of 320,242 MT.

Soybean futures are trading 4 cents higher this morning after finishing Wednesday with 2 to 3 cent gains. Oct soy meal was down 40 cents/ton, with nearby bean oil up 48 points on a bounce from weekly continuation chart support. Analysts are projecting 1 to 1.3 MMT in 17/18 soybean export sales for the week of September 28. Soybean sales totaled 2.982 MMT last week, as the week of 9/28 showed 454,000 MT in sales through the USDA daily reporting system. Soy meal sales ideas range from net reductions of 100,000 MT to sales of 300,000 MT. Soy oil sales are projected to total 0-32,000 MT. ABIOVE expects 2017/18 Brazil soybean production to hit 108.5 MMT, 4.66% lower than the 16/17 harvest projection.

Wheat futures are fractionally lower in the CBT and KC contracts this morning, with MPLS spring wheat 1 to 3 cents higher. They were down 4 to 6 cents in most CBT and KC contracts yesterday, as MPLS was steady to 2 1/2 cents lower. This morning’s Export Sales report is expected to show all wheat export sales for 2017/18 in a range of 300,000-500,000 MT for the week of September 28. Last week’s report indicated sales of 435,599 MT, up sharply from the previous week. Russia’s Ag ministry is estimating the country’s wheat production for 2017 at 80 MMT. USDA is carrying them at 81 MMT after bumping the estimate from 77.5 MMT in the September crop report. Ukraine’s exports of wheat from July – September totaled 6.48 MMT according to the country’s Ag food safety division.

Live cattle futures ended the day mixed with nearby Oct down 2.5 cents. Feeder cattle futures were mostly 32.5 cents to $1.175 lower on Wednesday. The CME feeder cattle index was down 11 cents at $155.65 on October 3.Wholesale beef prices were mixed in the Wednesday afternoon report. Choice was down 46 cents at $197.41, while select boxes were 53 cents higher at $189.55. The Ch/Se spread narrowed to $7.86. Week to date estimated FI cattle slaughter was at 342,000 head through Wednesday, 12,000 fewer than the previous week but 4,000 head larger than this week last year. Prices on the FCE online auction averaged $108, as ranges were $107 to $108.50. There were 784 of the 1,732 head sold, with 3 lots having offers of $107.75-$108.25 passed.

Lean hogs settled Wednesday mixed with nearby Oct 45 cents higher. The CME Lean Hog Index for 10/2 was 10 cents higher than the previous day at $54.39. The USDA pork carcass cutout value was up 42 cents at $72.88 in the Wednesday afternoon report. The picnic was $1.91 higher, with the ham up $3.59. The national base hog carcass price was $1.30 higher in the PM report at $50.97. Estimated week to date FI hog slaughter is 1,367,000 head through Wednesday, 12,000 head fewer than last week but 47,000 larger than the same week in 2016.

Cotton futures are 13 to as much as 53 points higher after posting some triple digit gains in the front months on Wednesday. The Cotlook A index for October 3 was down 85 points from the previous day at 77.70 cents/lb. The Seam showed online cash sale at 3,083 bales on Tuesday, with prices averaging 66.64 cents/lb. ICAC foresees further reductions in Chinese stocks, while world ex-China inventory expands. World mill use is expected to grow modestly in a lower price environment. They project the US to total 39% of the world trade activity, with 14.2 million bales of the 36.4 total.

Market Commentary provided by:

Brugler Marketing & Management LLC
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