As I sit here with my kids wondering what movie we are going to watch for our Friday movie night, I wonder how I got to be running so far behind. With our seminars this week the list got awfully long. Lateness seems to be a theme in the trade this week. Much of the price action was determined early in the week, at least on the grain side of things, with the bulls taking a few days to realize the market can actually go up as well. On the livestock side, specifically the cattle, be bears showed up on Thursday and Friday to send the bulls home with a bad attitude for the weekend.
Corn futures showed a small recovery on Friday to ease the bulls’ pain, but still closed with September down 8 cents (2.03%) on the week. December was down 6 ¾ cents (1.65%). Weekly Crop Progress data showed 77% of the US corn crop silking by July 28, now 1% ahead of normal, with 30% of the US corn acreage in the dough stages, vs. the average 22% pace. Condition ratings were back up 1% to 68% gd/ex, with the Brugler500 index 2 points higher to 372. Ethanol production, and thus corn use, improved to a record 1.109 million barrels per day in the week that ended on July 26, a 14,000 bpd bpd increase on the week according to the EIA. Stocks saw another build of 250,000 barrels to 23.973 million barrels, mainly on the increased production. Grain Crushings data showed a total of 442.35 mbu of corn used for ethanol production during June. That was slightly above June 2023, but a drop of 2.9% from May. Thursday’s Export Sales report indicated old crop corn bookings at 167,864 MT in the week ending on July 25. New crop sales totaled 710,888 MT in that week. The weekly Commitment of traders released from CFTC indicated spec traders in the corn market covering more shorts during the week that ended on July 30, by 23,453 contracts. That left them with a still large net short of 295,096 contracts by that Tuesday.
Wheat bulls gained some traction on the week on all three exchanges. Chicago was the leader to the upside this time, up 15 ½ cents (2.96%). Kansas City was right behind, rallying 14 ¼ cents (2.61%). Minneapolis spring wheat was the weakest, but still say a 6 ½ cent increase since last Friday. Monday’s Crop Progress report indicated that the winter wheat harvest was 82% complete by July 28, 2% above the average pace. The spring wheat crop was 94% headed, now 2% behind the average pace, with 1% listed as harvested. The spring wheat conditions were down 2% at 74% and 2 points lower to 381 on the Brugler500 index. Export Sales data showed 24/25 sales slipping back again to just 287,598 MT sold in the week that ended on July 25. Friday’s Commitment of Traders report showed CBT wheat spec traders adding back 2,432 contracts to their net short to 7577,616 contracts as of July 30. In KC wheat, they covered just 674 contracts of their net short to 40,192 contracts as of Tuesday.
Soybeans reverted to weaker trade this week, but saw some recovery in the last half to post a 24 cent (2.3%) loss in September. November was down 21 ¼ cents. Weakness in bean oil continued to add pressure, as September BO was down another 133 points (3.09%). September meal was down just 60 cents/ton. Export business was a little more active later in the week with 334,000 MT of new crop bean sales announced to China. The monthly Fats & Oils report showed 183.66 mbu of soybeans crushed in June. That was down 4.24% from May but still a 5.23% increase over a year ago. Bean oil stocks were down 2.9% from the end of May, but still above estimates at 2.12 billion lbs. NASS Crop Progress data showed 77% of the US soybean acreage blooming and 44% already setting pods, faster than the 5-year average. Condition ratings were down 1% from the week prior at 67% gd/ex, as the Brugler500 index was left at 370. This week’s Export Sales report showed bookings improving for old crop beans to 376,398 MT in the week that ended on July 25. New crop business slipped to 632,134 MT. CFTC data showed managed money adding back 14,932 contracts to their net short as of Tuesday July 30 at 178,591 contracts.
Live cattle saw some late week pressure from the stock market carryover and weaker economic data, as August was down $4.475 (2.37%) on the week. Cash trade slipped back this week with sales of $188 in the south, and northern trade at $194-196, both down $2-3 from last week. Feeders were down $10.05 since last Friday. The CME Feeder Cattle Index was down $1.12 week/week to $257.72. Wholesale boxed beef prices saw very slight changes on the week, as choice boxes were unchanged at $313.77, while Select was 29 cents lower to $297.17. Weekly beef production was down 1.2% from last week and 0.4% below the same week last year at 498.7 million lbs. That left the YTD beef production down 1.5% from the same time a year ago, with cattle slaughter down 4.4%. Export Sales data showed beef totaling 17,710 MT in sales for 2024, a 10-week high. Actual export shipments were tallied at 16,209 MT, slightly below last week. This week’s Commitment of Traders report pegged the managed money spec traders increasing their net long in live cattle by 13,837 contracts to 75,713 contracts net long as of July 30.
Hogs pulled back this week after a streak of gains in the weeks prior. August was down $1.27 (1.36%). The CME Lean Hog Index was up another $2.14 at $93.53 as of July 31. USDA’s Pork Carcass Cutout slipped back this week, down a total of 86 cents (-.08%) to $104.31. The belly was up $8.42 on the week, with the picnic and rib 50 and 43 cents higher. The ham led the charge to the downside, losing $9.75. Weekly pork production was back up 0.7% from last week, and 6.8% larger than the same week last year at 519.2 million lbs. YTD hog slaughter has run 1.1% above last year, with pork production 1.4% higher.
Pork export sales totaled 31,549 MT during the week that ended on 7/25, a 4-week high. Shipments totaled 30,141 MT in that week, a 4-week low. Lean hog spec traders were busy flipping back to a net long position in the week ending on July 30, by 10,574 contracts of futures and options by last Tuesday to a net long 6,144 contracts.
Cotton was back up 26 points in the December contract this week. Crop Progress data pegged 87% of the US cotton crop squared with 54% setting bolls, both ahead of normal. Cotton condition ratings dropped 4% lower 49% gd/ex, with the Brugler500 index at 327, a 12 point drop. Weekly Export Sales data showed old crop at net reductions of 1.09 million RB in the week that ended on 7/25 as we roll close to the end of the MY. Much of that was likely rolled to new crop at 1.36 million RB. Export shipments were tallied at 129,929 RB during that week, up from the previous week. The FSA cut the Adjusted World Price for cotton by 108 points on Thursday, to 53.94 cents/lb. Weekly data from CFTC showed managed money spec funds in cotton futures and options adding another 2,858 contracts to their now record net short as of July 30. By that Tuesday they were net short 47,441 contracts.
Market Watch
Next week starts with the Monday morning Export Inspections report, as the weekly Crop Progress report will be out that afternoon. Monday is also first notice day for August live cattle. Census trade data will be updated on Tuesday, showing June exports. Skip to Wednesday, and EIA will release their Weekly Petroleum Status Report, including an ethanol production and stocks update. Export Sales data will be released on Thursday morning.
See Page 4 for Tech Talk!
Tech Talk: November Soybeans.
Hope makes for a lousy marketing plan, but there was some slight (hopeful) positive action this week. The 2X Fib expansion support off the rally to the May high is at $10.15. The low for the week came on Thursday at $10.13. Friday did see a little short covering heading into the weekend, but we need more to get excited about any sort of a turnaround. The other positive sign is that RSI has a bullish divergence, though Stochastics are just now getting oversold. That does not mean buy. The declining regression channel has resistance at $10.57 ¾, with the 18-day moving average at $10.48. Both provided the sellers the last couple recoveries. If the bulls are looking for a test, that is one they need to pass. Failing support here likely indicates a test of $10 round number support.
Austin Schroeder
Brugler Marketing & Management LLC
Phone: 312-264-4333
There is a risk of loss in futures and options trading. Similar risks exist for cash commodity producers. Past performance is not necessarily indicative of future results.
Copyright 2024, Brugler Marketing & Management LLC. All rights reserved.
Running Late. Ag Marketing Report 08/05/2024
As I sit here with my kids wondering what movie we are going to watch for our Friday movie night, I wonder how I got to be running so far behind. With our seminars this week the list got awfully long. Lateness seems to be a theme in the trade this week. Much of the price action was determined early in the week, at least on the grain side of things, with the bulls taking a few days to realize the market can actually go up as well. On the livestock side, specifically the cattle, be bears showed up on Thursday and Friday to send the bulls home with a bad attitude for the weekend.
Corn futures showed a small recovery on Friday to ease the bulls’ pain, but still closed with September down 8 cents (2.03%) on the week. December was down 6 ¾ cents (1.65%). Weekly Crop Progress data showed 77% of the US corn crop silking by July 28, now 1% ahead of normal, with 30% of the US corn acreage in the dough stages, vs. the average 22% pace. Condition ratings were back up 1% to 68% gd/ex, with the Brugler500 index 2 points higher to 372. Ethanol production, and thus corn use, improved to a record 1.109 million barrels per day in the week that ended on July 26, a 14,000 bpd bpd increase on the week according to the EIA. Stocks saw another build of 250,000 barrels to 23.973 million barrels, mainly on the increased production. Grain Crushings data showed a total of 442.35 mbu of corn used for ethanol production during June. That was slightly above June 2023, but a drop of 2.9% from May. Thursday’s Export Sales report indicated old crop corn bookings at 167,864 MT in the week ending on July 25. New crop sales totaled 710,888 MT in that week. The weekly Commitment of traders released from CFTC indicated spec traders in the corn market covering more shorts during the week that ended on July 30, by 23,453 contracts. That left them with a still large net short of 295,096 contracts by that Tuesday.
Wheat bulls gained some traction on the week on all three exchanges. Chicago was the leader to the upside this time, up 15 ½ cents (2.96%). Kansas City was right behind, rallying 14 ¼ cents (2.61%). Minneapolis spring wheat was the weakest, but still say a 6 ½ cent increase since last Friday. Monday’s Crop Progress report indicated that the winter wheat harvest was 82% complete by July 28, 2% above the average pace. The spring wheat crop was 94% headed, now 2% behind the average pace, with 1% listed as harvested. The spring wheat conditions were down 2% at 74% and 2 points lower to 381 on the Brugler500 index. Export Sales data showed 24/25 sales slipping back again to just 287,598 MT sold in the week that ended on July 25. Friday’s Commitment of Traders report showed CBT wheat spec traders adding back 2,432 contracts to their net short to 7577,616 contracts as of July 30. In KC wheat, they covered just 674 contracts of their net short to 40,192 contracts as of Tuesday.
Soybeans reverted to weaker trade this week, but saw some recovery in the last half to post a 24 cent (2.3%) loss in September. November was down 21 ¼ cents. Weakness in bean oil continued to add pressure, as September BO was down another 133 points (3.09%). September meal was down just 60 cents/ton. Export business was a little more active later in the week with 334,000 MT of new crop bean sales announced to China. The monthly Fats & Oils report showed 183.66 mbu of soybeans crushed in June. That was down 4.24% from May but still a 5.23% increase over a year ago. Bean oil stocks were down 2.9% from the end of May, but still above estimates at 2.12 billion lbs. NASS Crop Progress data showed 77% of the US soybean acreage blooming and 44% already setting pods, faster than the 5-year average. Condition ratings were down 1% from the week prior at 67% gd/ex, as the Brugler500 index was left at 370. This week’s Export Sales report showed bookings improving for old crop beans to 376,398 MT in the week that ended on July 25. New crop business slipped to 632,134 MT. CFTC data showed managed money adding back 14,932 contracts to their net short as of Tuesday July 30 at 178,591 contracts.
Live cattle saw some late week pressure from the stock market carryover and weaker economic data, as August was down $4.475 (2.37%) on the week. Cash trade slipped back this week with sales of $188 in the south, and northern trade at $194-196, both down $2-3 from last week. Feeders were down $10.05 since last Friday. The CME Feeder Cattle Index was down $1.12 week/week to $257.72. Wholesale boxed beef prices saw very slight changes on the week, as choice boxes were unchanged at $313.77, while Select was 29 cents lower to $297.17. Weekly beef production was down 1.2% from last week and 0.4% below the same week last year at 498.7 million lbs. That left the YTD beef production down 1.5% from the same time a year ago, with cattle slaughter down 4.4%. Export Sales data showed beef totaling 17,710 MT in sales for 2024, a 10-week high. Actual export shipments were tallied at 16,209 MT, slightly below last week. This week’s Commitment of Traders report pegged the managed money spec traders increasing their net long in live cattle by 13,837 contracts to 75,713 contracts net long as of July 30.
Hogs pulled back this week after a streak of gains in the weeks prior. August was down $1.27 (1.36%). The CME Lean Hog Index was up another $2.14 at $93.53 as of July 31. USDA’s Pork Carcass Cutout slipped back this week, down a total of 86 cents (-.08%) to $104.31. The belly was up $8.42 on the week, with the picnic and rib 50 and 43 cents higher. The ham led the charge to the downside, losing $9.75. Weekly pork production was back up 0.7% from last week, and 6.8% larger than the same week last year at 519.2 million lbs. YTD hog slaughter has run 1.1% above last year, with pork production 1.4% higher.
Pork export sales totaled 31,549 MT during the week that ended on 7/25, a 4-week high. Shipments totaled 30,141 MT in that week, a 4-week low. Lean hog spec traders were busy flipping back to a net long position in the week ending on July 30, by 10,574 contracts of futures and options by last Tuesday to a net long 6,144 contracts.
Cotton was back up 26 points in the December contract this week. Crop Progress data pegged 87% of the US cotton crop squared with 54% setting bolls, both ahead of normal. Cotton condition ratings dropped 4% lower 49% gd/ex, with the Brugler500 index at 327, a 12 point drop. Weekly Export Sales data showed old crop at net reductions of 1.09 million RB in the week that ended on 7/25 as we roll close to the end of the MY. Much of that was likely rolled to new crop at 1.36 million RB. Export shipments were tallied at 129,929 RB during that week, up from the previous week. The FSA cut the Adjusted World Price for cotton by 108 points on Thursday, to 53.94 cents/lb. Weekly data from CFTC showed managed money spec funds in cotton futures and options adding another 2,858 contracts to their now record net short as of July 30. By that Tuesday they were net short 47,441 contracts.
Market Watch
Next week starts with the Monday morning Export Inspections report, as the weekly Crop Progress report will be out that afternoon. Monday is also first notice day for August live cattle. Census trade data will be updated on Tuesday, showing June exports. Skip to Wednesday, and EIA will release their Weekly Petroleum Status Report, including an ethanol production and stocks update. Export Sales data will be released on Thursday morning.
See Page 4 for Tech Talk!
Tech Talk: November Soybeans.
Hope makes for a lousy marketing plan, but there was some slight (hopeful) positive action this week. The 2X Fib expansion support off the rally to the May high is at $10.15. The low for the week came on Thursday at $10.13. Friday did see a little short covering heading into the weekend, but we need more to get excited about any sort of a turnaround. The other positive sign is that RSI has a bullish divergence, though Stochastics are just now getting oversold. That does not mean buy. The declining regression channel has resistance at $10.57 ¾, with the 18-day moving average at $10.48. Both provided the sellers the last couple recoveries. If the bulls are looking for a test, that is one they need to pass. Failing support here likely indicates a test of $10 round number support.
Austin Schroeder
Brugler Marketing & Management LLC
Phone: 312-264-4333
There is a risk of loss in futures and options trading. Similar risks exist for cash commodity producers. Past performance is not necessarily indicative of future results.
Copyright 2024, Brugler Marketing & Management LLC. All rights reserved.