Much quieter day yesterday in the cattle complex futures and for most contract months the primary direction was up, not down like the previous day. Feeders settled mildly higher in everything. Live cattle were mildly lower in Dec and Feb and mildly higher everywhere else.
Negotiated cash feedlot trade finally picked up some steam after being at a stalemate through midweek. The south traded mostly steady with last week’s prices in the $141 area. Nebraska was a couple dollars weaker in the dressed trade with the bottom end of it being $2 lower than last week. I’m not sure where the weighted average will land, because that’s going to depend on whether there’s more numbers traded today. Choice beef was briefly back up over $260 early in the week, but fell out of bed yesterday. If that upward trajectory would have continued, it might have been a little easier to squeeze more money out of the cash this week.
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Grain and oilseed trade had much quieter closes than recent days, just like the cattle. Corn finished down mildly, beans up mildly and wheat mild to moderately lower. There were some Chicago wheat months down in the teens, but KC and MGEX were mostly single digits in the net changes.
News-wise, it has been a slower week for corn, but the wheat and soybeans have had some bigger influencers. Russia stating they weren’t happy with the current state of Ukraine grain export shipments via the Black Sea was very friendly to wheat for a bit. The thought process behind that is if Russia begins blocking those shipments, that’s one less world supplier in the export trade. Not that it would help US wheat export much, because logistically we’re usually not considered in a lot of the business those two countries are vying for, but world-wise it’s friendly.
For the beans, there’s been two big negatives this week. One being China August import data that was down sharply from last year. Secondly, Argentina pinned their exchange rate to farmers at 200:1, which opened the flood gates to farmer selling, which in turn means more bushels available for Argentina to either export as beans or crush and export as meal. Granted, I’m also sitting here talking about bearish soybean influences and beans were up double digits in the overnight…
Weekly EIA ethanol data for corn showed production up 2% from the week prior, imports were zero and blender demand was very close to unchanged from last week. Total stocks declined 1.7%. That’s friendly all the way around for corn from a weekly standpoint.
Brazil’s CONAB came out with production estimates for this year’s crops yesterday. They raised soybean production 1.5 mmt’s. They actually lowered corn production by 1.419 mmt’s.
Funds yesterday were estimated sellers of 2500 wheat, 2k corn and on the buy side of 1k beans.
8am daily export reporting showed 104k mt’s of US soybean sales to Taiwan.
Coming up on Monday we get the September crop production and S&D numbers out from USDA. Reuters survey that was put out this week had corn yield at 172.5 bu/ac versus USDA’s 175.4 from the August report. Their average estimate on soybean yield was 51.5 bu/ac. USDA last month was 51.9 on beans. So, .4 bu/ac lower in beans and 2.9 bu/ac lower in corn are the expectations. Old crop ending stocks have trade estimates looking for a 17 mln bushel increase in corn from last month and 11 mln higher in beans. New crop stocks estimates have wheat up 8 mln bu from last month, corn down 171 mln bushels and soybeans up 2 mln bushels. World stocks estimates are leaning towards a mild increase in wheat compared to last month’s number, a moderate decline in corn and a mild drop in soybeans.
Pete Loewen
Loewen and Associates, Inc.
Pete Loewen / Matt Hines / Doug Biswell / Tyson Loewen
www.loewenassociates.com