This week was an ugly one for the ag markets. Of the front months, across the main ag markets, just bean oil and live cattle were higher, with the latter only held up due to the cash market. This last week was proof that just because it’s a short week (Wednesday holiday), it doesn’t mean it won’t be any less hectic. However, next week will likely add in a little more crazy to the mix with the USDA end of June reports via the Grain Stocks and Acreage releases. More times than not, there is some volatility associated with these reports due not only to the data that is in them, but also due to the fact that it is end of week, month, and quarter. Normally we will get some pre-report positioning ahead of the volatile day. And if this last week was any sort of indication not much bullish data is expected. Of course, there was more than just the market placing its bets, as weather conditions for the most part are improving, among other things. With that said we are getting into a crazy week, with a market that likely won’t slow down as we move into July. As my dad and grandpa always say, ‘Why go to Vegas, when you can farm?’ Place your bets and get ready!
Corn futures failed to hold the pre-holiday gains this week as July ended with a weekly loss of 15 cents (3.33%). New Crop December was down 17 cents on the Friday/Friday move. Rains over portions of the Corn Belt this week and pressure from the wheat market pressured things. Monday’s Crop Progress report showed 93% of the US corn crop planted emerged as of 6/16. Condition ratings were down 2% to 72% gd/ex, with the Brugler500 index slipping 3 points to 381. EIA data showed a 34,000 barrel per day increase in ethanol production during the week that ended on 6/14 to 1.057 million bpd. Ethanol stocks were up 395,000 barrels to 23.617 million, mainly in the Gulf and Coast regions. Export Sales data tallied corn bookings at just 511,432 MT in the week ending on June 13, a 9-week low, with 93,640 MT for new crop. Commitments for old crop corn exports are now at 52.836 MMT, 97% of USDA’s forecast, compared to the 100% average pace for this point in the year.
The wheat bears didn’t let up this week, as sellers were around until the Friday close. Chicago wheat led the charge to the downside, as July fell 51 ¼ cents (8.36%). Kansas City slipped 46 ¼ cents over the course of the week for a 7.37% loss. MPLS futures were next in line, down 44 cents (6.71%). Private Russian firm, IKAR, added 0.5 MMT back to their production output for the country to 82 MMT this week. US harvest pressure was the other part of the issue as the Crop Progress report showed harvest at 27% complete by last Sunday. That is well above the 14% average. Condition ratings were back up 2% this week at 49% gd/ex, with the Brugler500 index up 5 points to 335. The spring wheat crop was pegged at 4% headed, behind the 7% average pace, with conditions up 4% to 76% and 5 points higher to 379 on the Brugler500 index. Friday’s Export Sales report showed 24/25 sales of 589,695 MT during the week of 6/13, the largest for any week since mid-January. That took the commitments for early in the year to 5.45 MMT, which is 25% of USDA’s 800 mbu forecast and lags the 27% average pace.
Soybeans tried to pare back some of the losses on Friday, but still closed with July down 19 ¼ cents (1.63%). New crop November was 29 ¾ cents (2.59%) over the course of the week. Meal slipped back $6.60/ton since last Friday. Bean oil found some strength, with July up 26 points. Weekly Crop Progress data showed 93% of the US soybean crop planted by June 16, with 82% of the crop emerged. Crop ratings slipped back 2% to 70% gd/ex and a Brugler500 at 376, down 3 points. NOPA’s monthly release from Monday pegged crush during May at 183.625 mbu, a record for the month. Stocks were drawn down by 5.93% from last month to 1.72 billion lbs. The weekly Export Sales report indicated bean bookings improving to 556,453 MT in the week that ended on June 13. New crop business continues to be slow but did pick up to 83,975 MT reported in that week. As for old crop commitments, they have reached 96% of the USDA forecast, which lags the 101% average pace. We need more weeks like this last report to play catchup!
Live cattle were held up by the cash market, with June up 77 cents, as August was down a single tick from the previous week. Cash trade was late this week with a few light Friday sales of $189-191 in the south and dressed sales of $310-312 in NE. Feeders slipped back $3.60 on the week. The CME Feeder Cattle Index was up $1.34 week/week to $257.47. Friday’s Cattle on Feed report indicated May placements totaling 2.046 million head, a 4.28% increase, with marketings up 0.15% at 1.955 million head. That took the June 1 on feed figure for the month to 11.583 million head, a 0.06% decline from last year. Wholesale boxed beef quotes were mixed this week but held firm. Choice boxes were up $2.50 (0.8%) at $322.39, while Select was 70 cents lower to $303.11. The Chc/Sel spread widened to $19.28. Weekly beef production was up 0.7% from last week and slightly higher vs. the same week last year at 525.8 million lbs. That took the YTD beef production to down 1.5% from the same time a year ago, with cattle slaughter down 4.4%. Larger weights have been an issue. Export Sales data indicated a total of 14,872 MT of beef sold in the week of June 13, a 3-week high. Export Shipments totaled 16,752 MT, the largest in 4-weeks.
Hogs felt some weakness since last Friday, despite an attempted turnaround at the end of last week, with July down $1.60. The CME Lean Hog Index was down $1.03 at $90.55. USDA’s Pork Carcass Cutout felt some pressure this week, ending with a $2.32 (-2.3%) loss to $99.03. The belly was the main driver of that move, down $16.51, with just the loin (-$2.22) the only other primal reported lower. Weekly pork production was up 1.7% from last week and 4.7% larger than the same week last year at 521.5 million lbs. YTD hog slaughter has run 0.9% above last year, with pork production 0.9% higher. All pork export bookings totaled 21,448 MT during the week ending on June 13, a 5-week low. Actual shipments were tallied at 28,969 MT, dropping to the second lowest this MY.
Cotton saw some spreading this week, as July collapsed 278 points ahead of first notice day. New crop December actually saw a 7-point gain. The weekly Crop Progress report showed 90% of the US cotton crop planted as of 6/16, with 22% squared and 6% already setting bolls. Cotton condition ratings were down another 2% to 54% gd/ex, with the Brugler500 index at 346, a drop of 7 points. USDA’s Export Sales report showed old crop sales at 189,016 RB in the week that ended on 6/13. New crop sales pulled back to 111,799 RB. Export shipments picked back up this week to 197,905 RB. The FSA cut the Adjusted World Price for cotton by 67 points on Thursday, to 56.65 cents/lb.
Market Watch
The last week of June starts out with the weekly Export Inspections report on Monday morning, and the NASS Crop Progress report released that afternoon. Monday is also first notice day for July cotton futures. Tuesday afternoon we will be graced with the NASS Cold Storage report. On Wednesday, the EIA will report ethanol stocks and production data. Export Sales data will be published on Thursday morning, with the quarterly Hogs & Pigs report released that afternoon. We will likely have a volatile session on Friday to round out week, month, and quarter with the annual June Planted Acreage and quarterly Grain Stocks reports.
See Page 4 for Tech Talk
Tech Talk: November Soybeans
November beans don’t look so hot right now. After a failed attempt at a spring rally, the market decided to go a pick some stops off below the Feb low (11.225) and more. The May 2023 low at $11.165 was spiked on Friday, but did end up holding into the close. There is one caveat with that one, and that is it could be seen as a triple bottom, which almost never hold. Now, there are a couple positive outlooks with the Friday action, as we are trying to hold the 78.6% Fib retracement support off the LOC low at $11.205. Breaking that opens the door to $10.50, with round number $11 support a last resort. Referencing the weekly chart support via the 100-week moving average at $11.44 (applies to July still), would put chart support for Nov around $11-11.04. The bearish MACD suggests we stay short as does the high ADX. RSI is looking like a bullish divergence, but we need to exit oversold first. Stochastics seem to be attempting a double hump but reference the previous sentence. The first step in reversing the bear trend would mean taking out parabolic SAR at $11.47 ¼. The 18-day moving average resistance is also up there at $11.57 ¾.
Austin Schroeder
Brugler Marketing & Management LLC
Phone: 312-264-4333
There is a risk of loss in futures and options trading. Past performance is not necessarily indicative of future results.
Copyright 2024, Brugler Marketing & Management LLC. All rights reserved.
Place Your Bets. Ag Marketing Report 06/24/2024
This week was an ugly one for the ag markets. Of the front months, across the main ag markets, just bean oil and live cattle were higher, with the latter only held up due to the cash market. This last week was proof that just because it’s a short week (Wednesday holiday), it doesn’t mean it won’t be any less hectic. However, next week will likely add in a little more crazy to the mix with the USDA end of June reports via the Grain Stocks and Acreage releases. More times than not, there is some volatility associated with these reports due not only to the data that is in them, but also due to the fact that it is end of week, month, and quarter. Normally we will get some pre-report positioning ahead of the volatile day. And if this last week was any sort of indication not much bullish data is expected. Of course, there was more than just the market placing its bets, as weather conditions for the most part are improving, among other things. With that said we are getting into a crazy week, with a market that likely won’t slow down as we move into July. As my dad and grandpa always say, ‘Why go to Vegas, when you can farm?’ Place your bets and get ready!
Corn futures failed to hold the pre-holiday gains this week as July ended with a weekly loss of 15 cents (3.33%). New Crop December was down 17 cents on the Friday/Friday move. Rains over portions of the Corn Belt this week and pressure from the wheat market pressured things. Monday’s Crop Progress report showed 93% of the US corn crop planted emerged as of 6/16. Condition ratings were down 2% to 72% gd/ex, with the Brugler500 index slipping 3 points to 381. EIA data showed a 34,000 barrel per day increase in ethanol production during the week that ended on 6/14 to 1.057 million bpd. Ethanol stocks were up 395,000 barrels to 23.617 million, mainly in the Gulf and Coast regions. Export Sales data tallied corn bookings at just 511,432 MT in the week ending on June 13, a 9-week low, with 93,640 MT for new crop. Commitments for old crop corn exports are now at 52.836 MMT, 97% of USDA’s forecast, compared to the 100% average pace for this point in the year.
The wheat bears didn’t let up this week, as sellers were around until the Friday close. Chicago wheat led the charge to the downside, as July fell 51 ¼ cents (8.36%). Kansas City slipped 46 ¼ cents over the course of the week for a 7.37% loss. MPLS futures were next in line, down 44 cents (6.71%). Private Russian firm, IKAR, added 0.5 MMT back to their production output for the country to 82 MMT this week. US harvest pressure was the other part of the issue as the Crop Progress report showed harvest at 27% complete by last Sunday. That is well above the 14% average. Condition ratings were back up 2% this week at 49% gd/ex, with the Brugler500 index up 5 points to 335. The spring wheat crop was pegged at 4% headed, behind the 7% average pace, with conditions up 4% to 76% and 5 points higher to 379 on the Brugler500 index. Friday’s Export Sales report showed 24/25 sales of 589,695 MT during the week of 6/13, the largest for any week since mid-January. That took the commitments for early in the year to 5.45 MMT, which is 25% of USDA’s 800 mbu forecast and lags the 27% average pace.
Soybeans tried to pare back some of the losses on Friday, but still closed with July down 19 ¼ cents (1.63%). New crop November was 29 ¾ cents (2.59%) over the course of the week. Meal slipped back $6.60/ton since last Friday. Bean oil found some strength, with July up 26 points. Weekly Crop Progress data showed 93% of the US soybean crop planted by June 16, with 82% of the crop emerged. Crop ratings slipped back 2% to 70% gd/ex and a Brugler500 at 376, down 3 points. NOPA’s monthly release from Monday pegged crush during May at 183.625 mbu, a record for the month. Stocks were drawn down by 5.93% from last month to 1.72 billion lbs. The weekly Export Sales report indicated bean bookings improving to 556,453 MT in the week that ended on June 13. New crop business continues to be slow but did pick up to 83,975 MT reported in that week. As for old crop commitments, they have reached 96% of the USDA forecast, which lags the 101% average pace. We need more weeks like this last report to play catchup!
Live cattle were held up by the cash market, with June up 77 cents, as August was down a single tick from the previous week. Cash trade was late this week with a few light Friday sales of $189-191 in the south and dressed sales of $310-312 in NE. Feeders slipped back $3.60 on the week. The CME Feeder Cattle Index was up $1.34 week/week to $257.47. Friday’s Cattle on Feed report indicated May placements totaling 2.046 million head, a 4.28% increase, with marketings up 0.15% at 1.955 million head. That took the June 1 on feed figure for the month to 11.583 million head, a 0.06% decline from last year. Wholesale boxed beef quotes were mixed this week but held firm. Choice boxes were up $2.50 (0.8%) at $322.39, while Select was 70 cents lower to $303.11. The Chc/Sel spread widened to $19.28. Weekly beef production was up 0.7% from last week and slightly higher vs. the same week last year at 525.8 million lbs. That took the YTD beef production to down 1.5% from the same time a year ago, with cattle slaughter down 4.4%. Larger weights have been an issue. Export Sales data indicated a total of 14,872 MT of beef sold in the week of June 13, a 3-week high. Export Shipments totaled 16,752 MT, the largest in 4-weeks.
Hogs felt some weakness since last Friday, despite an attempted turnaround at the end of last week, with July down $1.60. The CME Lean Hog Index was down $1.03 at $90.55. USDA’s Pork Carcass Cutout felt some pressure this week, ending with a $2.32 (-2.3%) loss to $99.03. The belly was the main driver of that move, down $16.51, with just the loin (-$2.22) the only other primal reported lower. Weekly pork production was up 1.7% from last week and 4.7% larger than the same week last year at 521.5 million lbs. YTD hog slaughter has run 0.9% above last year, with pork production 0.9% higher. All pork export bookings totaled 21,448 MT during the week ending on June 13, a 5-week low. Actual shipments were tallied at 28,969 MT, dropping to the second lowest this MY.
Cotton saw some spreading this week, as July collapsed 278 points ahead of first notice day. New crop December actually saw a 7-point gain. The weekly Crop Progress report showed 90% of the US cotton crop planted as of 6/16, with 22% squared and 6% already setting bolls. Cotton condition ratings were down another 2% to 54% gd/ex, with the Brugler500 index at 346, a drop of 7 points. USDA’s Export Sales report showed old crop sales at 189,016 RB in the week that ended on 6/13. New crop sales pulled back to 111,799 RB. Export shipments picked back up this week to 197,905 RB. The FSA cut the Adjusted World Price for cotton by 67 points on Thursday, to 56.65 cents/lb.
Market Watch
The last week of June starts out with the weekly Export Inspections report on Monday morning, and the NASS Crop Progress report released that afternoon. Monday is also first notice day for July cotton futures. Tuesday afternoon we will be graced with the NASS Cold Storage report. On Wednesday, the EIA will report ethanol stocks and production data. Export Sales data will be published on Thursday morning, with the quarterly Hogs & Pigs report released that afternoon. We will likely have a volatile session on Friday to round out week, month, and quarter with the annual June Planted Acreage and quarterly Grain Stocks reports.
See Page 4 for Tech Talk
Tech Talk: November Soybeans
November beans don’t look so hot right now. After a failed attempt at a spring rally, the market decided to go a pick some stops off below the Feb low (11.225) and more. The May 2023 low at $11.165 was spiked on Friday, but did end up holding into the close. There is one caveat with that one, and that is it could be seen as a triple bottom, which almost never hold. Now, there are a couple positive outlooks with the Friday action, as we are trying to hold the 78.6% Fib retracement support off the LOC low at $11.205. Breaking that opens the door to $10.50, with round number $11 support a last resort. Referencing the weekly chart support via the 100-week moving average at $11.44 (applies to July still), would put chart support for Nov around $11-11.04. The bearish MACD suggests we stay short as does the high ADX. RSI is looking like a bullish divergence, but we need to exit oversold first. Stochastics seem to be attempting a double hump but reference the previous sentence. The first step in reversing the bear trend would mean taking out parabolic SAR at $11.47 ¼. The 18-day moving average resistance is also up there at $11.57 ¾.
Austin Schroeder
Brugler Marketing & Management LLC
Phone: 312-264-4333
There is a risk of loss in futures and options trading. Past performance is not necessarily indicative of future results.
Copyright 2024, Brugler Marketing & Management LLC. All rights reserved.