The other day, my wife was at home with me as I was busy working. As she looked at my troubled face, trying to navigate these markets, she asked me what was wrong. I answered her with something to the effect of ‘I have to deal with this,’ pointing at a screen of red numbers, and stated ‘some days the market doesn’t even know what it wants to do’. It was at that point that she replied to me (her words, not mine), “the markets are like an emotional woman, sometimes you just never know.” Followed up by “and men (for the most part) are the ones who run them, so that just makes things worse!” Truer words have never been spoken.
Corn futures failed to hold the early week Monday gains, as the trade spent the rest of the week in giveback mode. September was down 2 ¾ cents on the week with the December contract losing 1 ½ cents. Crop Progress data from NASS showed 74% of the US corn crop in the dough as of August 18, with 30% of US corn acres dented and 5% listed as mature. Condition ratings were steady 67% gd/ex, with the Brugler500 index slipping 2 points to 368. The Pro Farmer Crop Tour was this week, most states seeing decent yields, with the exception of Minnesota. Their projected 2024 US corn yield was 181.1 bushels per acre. EIA’s weekly report showed ethanol production, and thus corn use, up 26,000 barrels per day to 1.098 million barrels per day in the week that ended on August 16. Stocks saw a 220,000 barrels build to 23.574 million barrels. The weekly Export Sales report showed old crop corn bookings at just 119,123 MT in the week ending on August 15, a MY low but normal for this late in the marketing year. New crop sales were a MY high at 1.291 MMT in that week. The weekly Commitment of Traders report indicated spec traders in the corn market adding back 8,889 contracts to their net short position in the week that ended on August 20, to 257,896 contracts by that Tuesday.
Wheat saw continued pressure this week, mainly in the last few days, as all three exchanges saw sharp losses. Minneapolis spring wheat was the leader to the downside this week with losses of 41 ½ cents 0-(7%). Chicago followed along, with September down 27 ¾ cents (-5.24%). Kansas City September was 19 ¾ cent in the red (-3.66%). The weekly Crop Progress report tallied the winter wheat harvest at 96% complete by August 18. The spring wheat crop was 315 harvested and lagging the average by 5 percentage points. Spring wheat conditions were up 1% to 73% gd/ex, with the Brugler500 index steady at 379. Export Sales data showed 24/25 sales higher this week to 492,663 MT in the week that ended on 8/15. Friday’s Commitment of Traders report showed CBT wheat spec traders slashing 20,303 contracts from their net short to 52,985 contracts as of August 20. In KC wheat, they added back 2,495 contracts to their net short at 36,319 contracts as of Tuesday.
Soybeans were a rare bright spot this week, as September climbed 13 ¼ cents out of their recent hole, with November up 16 cents. The products were helpful this week with September meal up $2.90, as bean oil bounced 152 points. The other supportive factor was the low prices attracting demand, with over 1.38 MMT in daily flash sales reported this week. Weekly Crop Progress data showed 95% of the US soybean acreage blooming and 81% setting pods. Condition ratings were steady at 68% gd/ex, as the Brugler500 index was 1 point higher at 372. The Pro Farmer Crop Tour was this week, most states showing excellent pod counts across the 7-state route. On Friday they projected the 2024 US soybean yield at 54.9 bushels per acre, well above the 53.2 bpa from USDA. This week’s Export Sales report showed net reductions of slipping for old crop beans to 43,745 MT in the week that ended on August 15. New crop business improved to 1.677 MMT, a MY high. CFTC data showed managed money adding back another 8,311 contracts to their net short as of Tuesday August 13 at 182,758 contracts, near the previous record net short.
Live cattle continued the slide this week on early week action, as October was down $2.60 (-1.46%). Cash trade saw some southern action at $182-185, with the bulk at $183 and down $2 on the week. Northern trade was at $288-295 in the beef, centered at $293 and down $5. Feeders were down another 92 cents in the September contract this week. USDA’s Cattle on Feed report showed July placements at 1.702 million head, up 5.85% from a year ago, with marketings at 1.855 million head and 7.72% above 2023. August 1 on feed inventory was up 0.28% from last year at 11.095 million head. Cold Storage data showed 407.13 million lbs of beef stocks as of July 31, a 0.2% drop from the end of June and 0.81% below last year. The CME Feeder Cattle Index was down $5.01 week/week to $241.70. Wholesale boxed beef prices were back lower on the week, as choice boxes were down 12 cents at $317.34, while Select was $2.13 lower to $300.46. Weekly beef production was up 1.4% from last week but 0.3% below the same week last year at 513.9 million lbs. That left the YTD beef production down 1.3% from the same time a year ago, with cattle slaughter down 4.2%.
Hogs hit the blast off button this week, as October was up $5.475, or 7.29% since last Friday. The CME Lean Hog Index was down $1.19 this week at $88.83 as of August 21. USDA’s Pork Carcass Cutout was up just 38 cents this week to $99.05. The ham was the leader to the upside on the week, $3.07 higher, with the rib up $2.55. The belly was down $5.07. Pork stocks totaled 450.7 million lbs at the end of July, which was a 5.09% drop from the end of June and 4.26% below last year, according to the afternoon Cold Storage report. Weekly pork production was back down 0.5% from last week but up 2.8% from the same week last year at 526.3 million lbs. YTD hog slaughter has run 1.2% above last year, with pork production 1.5% higher. Specs in lean hog futures and options flipped back to a net long position by August 20 by 9,584 contracts to a net long of 7,315 contracts.
Cotton posted a nice turnaround for the bulls this week as December closed back above the 70 cent level with a 376 point rally (5.46%) on the week. Crop Progress data showed 84% of the US cotton crop setting bolls, with 19% of the crop with bolls open by August 18. Condition ratings were 4% lower to 43% gd/ex, with the Brugler500 index at 315, back down 4 points. Export Sales data showed upland cotton sales of 93,008 RB in the week ending on August 15, down 16.17% from last week. Actual shipments were 168,837 RB in that week. The FSA raised the Adjusted World Price for cotton by 55 points on Thursday, to 55.90 cents/lb. Weekly data from CFTC showed managed money spec funds in cotton futures and options adding 2,391 contracts to their net short as of August 20. By that Tuesday they were net short a near record 51,845 contracts.
Market Watch
We start next week with the Monday morning Export Inspections report, as the weekly Crop Progress report will be out in the afternoon. Skip ahead to Wednesday and the EIA will release their Weekly Petroleum Status Report, showing an ethanol production and stocks update. On Thursday, FAS will release their weekly Export Sales report in the morning, with CME Feeder Cattle futures and options expiring that afternoon. On Friday, PCE data will be released ahead of the long weekend. It is the first notice day for September grain futures and the last trade day for August live cattle.
Tech Talk: December Corn
December corn, along with the rest of the grains, has felt pressure for much of the growing season. But when everyone and their grandma is projecting a record crop, that is what happens. It doesn’t necessarily matter what the bullish argument is (unless it’s negating the large crop like frost or a derecho), the market seems solely focused on making sure the demand is there. Lately, we have lateral support for December at last Friday’s low of $3.90. We got to within ¼ cent of it on Friday, but it held. The Bollinger midline has been resistance since it was spiked in late July at $3.985. If that is taken out, the 40-day moving average is at $4.065. Stochastics are stuck in neutral, as the Bollinger bands tighten with the lower BB support at $3.90 ¼ and upper at $4.06 ¾. RSI is oversold, though that only seems to be good enough for a bounce to the Bollinger midline.
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.
Sometimes You Just Never Know. Ag Marketing Report 08/26/2024
The other day, my wife was at home with me as I was busy working. As she looked at my troubled face, trying to navigate these markets, she asked me what was wrong. I answered her with something to the effect of ‘I have to deal with this,’ pointing at a screen of red numbers, and stated ‘some days the market doesn’t even know what it wants to do’. It was at that point that she replied to me (her words, not mine), “the markets are like an emotional woman, sometimes you just never know.” Followed up by “and men (for the most part) are the ones who run them, so that just makes things worse!” Truer words have never been spoken.
Corn futures failed to hold the early week Monday gains, as the trade spent the rest of the week in giveback mode. September was down 2 ¾ cents on the week with the December contract losing 1 ½ cents. Crop Progress data from NASS showed 74% of the US corn crop in the dough as of August 18, with 30% of US corn acres dented and 5% listed as mature. Condition ratings were steady 67% gd/ex, with the Brugler500 index slipping 2 points to 368. The Pro Farmer Crop Tour was this week, most states seeing decent yields, with the exception of Minnesota. Their projected 2024 US corn yield was 181.1 bushels per acre. EIA’s weekly report showed ethanol production, and thus corn use, up 26,000 barrels per day to 1.098 million barrels per day in the week that ended on August 16. Stocks saw a 220,000 barrels build to 23.574 million barrels. The weekly Export Sales report showed old crop corn bookings at just 119,123 MT in the week ending on August 15, a MY low but normal for this late in the marketing year. New crop sales were a MY high at 1.291 MMT in that week. The weekly Commitment of Traders report indicated spec traders in the corn market adding back 8,889 contracts to their net short position in the week that ended on August 20, to 257,896 contracts by that Tuesday.
Wheat saw continued pressure this week, mainly in the last few days, as all three exchanges saw sharp losses. Minneapolis spring wheat was the leader to the downside this week with losses of 41 ½ cents 0-(7%). Chicago followed along, with September down 27 ¾ cents (-5.24%). Kansas City September was 19 ¾ cent in the red (-3.66%). The weekly Crop Progress report tallied the winter wheat harvest at 96% complete by August 18. The spring wheat crop was 315 harvested and lagging the average by 5 percentage points. Spring wheat conditions were up 1% to 73% gd/ex, with the Brugler500 index steady at 379. Export Sales data showed 24/25 sales higher this week to 492,663 MT in the week that ended on 8/15. Friday’s Commitment of Traders report showed CBT wheat spec traders slashing 20,303 contracts from their net short to 52,985 contracts as of August 20. In KC wheat, they added back 2,495 contracts to their net short at 36,319 contracts as of Tuesday.
Soybeans were a rare bright spot this week, as September climbed 13 ¼ cents out of their recent hole, with November up 16 cents. The products were helpful this week with September meal up $2.90, as bean oil bounced 152 points. The other supportive factor was the low prices attracting demand, with over 1.38 MMT in daily flash sales reported this week. Weekly Crop Progress data showed 95% of the US soybean acreage blooming and 81% setting pods. Condition ratings were steady at 68% gd/ex, as the Brugler500 index was 1 point higher at 372. The Pro Farmer Crop Tour was this week, most states showing excellent pod counts across the 7-state route. On Friday they projected the 2024 US soybean yield at 54.9 bushels per acre, well above the 53.2 bpa from USDA. This week’s Export Sales report showed net reductions of slipping for old crop beans to 43,745 MT in the week that ended on August 15. New crop business improved to 1.677 MMT, a MY high. CFTC data showed managed money adding back another 8,311 contracts to their net short as of Tuesday August 13 at 182,758 contracts, near the previous record net short.
Live cattle continued the slide this week on early week action, as October was down $2.60 (-1.46%). Cash trade saw some southern action at $182-185, with the bulk at $183 and down $2 on the week. Northern trade was at $288-295 in the beef, centered at $293 and down $5. Feeders were down another 92 cents in the September contract this week. USDA’s Cattle on Feed report showed July placements at 1.702 million head, up 5.85% from a year ago, with marketings at 1.855 million head and 7.72% above 2023. August 1 on feed inventory was up 0.28% from last year at 11.095 million head. Cold Storage data showed 407.13 million lbs of beef stocks as of July 31, a 0.2% drop from the end of June and 0.81% below last year. The CME Feeder Cattle Index was down $5.01 week/week to $241.70. Wholesale boxed beef prices were back lower on the week, as choice boxes were down 12 cents at $317.34, while Select was $2.13 lower to $300.46. Weekly beef production was up 1.4% from last week but 0.3% below the same week last year at 513.9 million lbs. That left the YTD beef production down 1.3% from the same time a year ago, with cattle slaughter down 4.2%.
Hogs hit the blast off button this week, as October was up $5.475, or 7.29% since last Friday. The CME Lean Hog Index was down $1.19 this week at $88.83 as of August 21. USDA’s Pork Carcass Cutout was up just 38 cents this week to $99.05. The ham was the leader to the upside on the week, $3.07 higher, with the rib up $2.55. The belly was down $5.07. Pork stocks totaled 450.7 million lbs at the end of July, which was a 5.09% drop from the end of June and 4.26% below last year, according to the afternoon Cold Storage report. Weekly pork production was back down 0.5% from last week but up 2.8% from the same week last year at 526.3 million lbs. YTD hog slaughter has run 1.2% above last year, with pork production 1.5% higher. Specs in lean hog futures and options flipped back to a net long position by August 20 by 9,584 contracts to a net long of 7,315 contracts.
Cotton posted a nice turnaround for the bulls this week as December closed back above the 70 cent level with a 376 point rally (5.46%) on the week. Crop Progress data showed 84% of the US cotton crop setting bolls, with 19% of the crop with bolls open by August 18. Condition ratings were 4% lower to 43% gd/ex, with the Brugler500 index at 315, back down 4 points. Export Sales data showed upland cotton sales of 93,008 RB in the week ending on August 15, down 16.17% from last week. Actual shipments were 168,837 RB in that week. The FSA raised the Adjusted World Price for cotton by 55 points on Thursday, to 55.90 cents/lb. Weekly data from CFTC showed managed money spec funds in cotton futures and options adding 2,391 contracts to their net short as of August 20. By that Tuesday they were net short a near record 51,845 contracts.
Market Watch
We start next week with the Monday morning Export Inspections report, as the weekly Crop Progress report will be out in the afternoon. Skip ahead to Wednesday and the EIA will release their Weekly Petroleum Status Report, showing an ethanol production and stocks update. On Thursday, FAS will release their weekly Export Sales report in the morning, with CME Feeder Cattle futures and options expiring that afternoon. On Friday, PCE data will be released ahead of the long weekend. It is the first notice day for September grain futures and the last trade day for August live cattle.
Tech Talk: December Corn
December corn, along with the rest of the grains, has felt pressure for much of the growing season. But when everyone and their grandma is projecting a record crop, that is what happens. It doesn’t necessarily matter what the bullish argument is (unless it’s negating the large crop like frost or a derecho), the market seems solely focused on making sure the demand is there. Lately, we have lateral support for December at last Friday’s low of $3.90. We got to within ¼ cent of it on Friday, but it held. The Bollinger midline has been resistance since it was spiked in late July at $3.985. If that is taken out, the 40-day moving average is at $4.065. Stochastics are stuck in neutral, as the Bollinger bands tighten with the lower BB support at $3.90 ¼ and upper at $4.06 ¾. RSI is oversold, though that only seems to be good enough for a bounce to the Bollinger midline.
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.