We are just over a week past the election and deciding the leader of the free world. Leaders are important for a number of reasons, especially in times of despair. When all hope is gone, there are some who take it upon themselves to turn things around. And this week, the feeders were the true leaders. Among the major ag commodities this week, just the feeder cattle saw any form of strength, as the grains, oilseeds, cotton, the other livestocks, and even the crude oil and gold markets took a hit this week. In this week of increased bearish sentiment, the bulls looked for a leader and found the feeder market, but will it be enough of a rally cry to push the complex higher next week? Only time will tell!
Corn tried to hold some ground this week amid a wheat market that was falling apart, as December was down 7 cents (1.62%). This week’s Crop Progress report showed 95% of the US corn crop harvested by November 10, still running well ahead of the 84% average. EIA data showed record ethanol production in the week of 11/8, up another 8,000 barrels per day to 1.113 million bpd. Stocks of ethanol were up 249just 19,000 barrels to 22.039 million barrels. Export Sales data showed bookings backing off to the lowest in 5 weeks at 1.315 MMT in the week ending on November 7. That took export commitments to 29.901 MMT, a 42% increase over last year. That is also 51% of the US export forecast and now ahead of the average sales pace of 44%. Commitment of Traders data showed managed money adding to their net long by 87,946 contracts in the week that ended on 11/12. That took them to the largest net long in over 20 months at 109,979 contracts.
Wheat piled the pressure on the grains this week as all three exchanges saw sharp losses. Rains this week and more in the forecast put some pressure on the market. Chicago December collapsed by 36 cents (-6.29%) on the week. December Kansas City saw a loss of 24 1/4 cents (-4.30 %) this week. MPLS Dec was down 25 1/2 cents since last Friday (-4.27%). Crop Progress data showed the winter wheat crop at 91% planted by last Sunday, with emergence at 76% of the crop. Condition ratings were tallied at 44% in good/excellent condition, up 3% on the week, as the Brugler500 score was improved by 10 points at 326. Export Sales data showed US export business improving slightly in the week that ended on 11/7 to 380,056 MT. That took export sale commitments to 14.377 MMT, which is 64% of the USDA forecast for exports, still lagging the 67% average selling pace. CFTC’s weekly report showed CBT wheat spec traders increasing their net short position by 14,526 contracts to a net short of 45,307 contracts as of 11/12. In KC wheat, they added another 11,018 contracts to their net short position at 25,098 contracts as of Tuesday.
Soybeans got continued pressure from the products this week, as January was down 31 ¾ cents (-3.08%). Soybean meal saw losses of $6.60 and are exploring new multi-year lows. Bean oil was also a pressure factor, falling 342 points on the week (-7.01%). The pick of Lee Zeldin as head of EPA was seen as less friendly to the market given his history with the RFS. Late in the week bean oil was pulled off its lows with news that China is expected to remove a 13% rebate on exports of used cooking oil. Tuesday’s Crop Progress report showed 96% of the US soybean harvest was complete by 11/10, well ahead of the 91% average pace. NOPA data showed October crush at 199.96 mbu among members, 5.37% above October 2023. Stocks of bean oil were 1.069 billion lbs as of October 31, down 2.8% from last year at this time. Export Sales data showed 2024/25 business backing off to 1.555 MMT. That took the accumulated shipped and unshipped sales to 29.858 MMT. That is 60% of USDA’s expected export total in their WASDE balance sheet, now 5 percentage points back of the average pace. CFTC Commitment of Traders data showed soybean spec traders cutting 15,576 contracts from their net short position as of Tuesday, to 54,536 contracts.
Live cattle extended their pull back this week, with December down just 75 cents this time (-0.41%). Cash trade was mostly $185 this week, a $1-3 drop from the week prior. As stated in the intro, feeders were the leaders, up $5.80 (2.40%) in the January contract this week. The CME Feeder Cattle Index was back up $2.45 week/week to $252.31. Wholesale boxed beef prices backed off again this week, as Choice was down $4.59 (-1.5%) to $303.34, while Select was $3.05 lower (-1.1%) to $276.14. Weekly beef production was down 2% from the previous week and 1.8% above the same week last year at 525.6 million lbs. That left the YTD beef production down 0.5% from the same time a year ago, with cattle slaughter down 3.7%. Export Sales data showed beef bookings of 14,153 MT, improved from last week’s calendar year low. Shipments were tallied at 15,845 MT, a 3-week high. Commitment of Traders data showed managed money in live cattle futures and options adding 5,479 contracts to their net long at 103,317 contracts as of 11/12. Specs in feeder cattle added 685 contracts to their net long at 12,059 contracts as of Tuesday.
Hogs slid another 92 cents this week, as December was down 1.15%. The CME Lean Hog Index was back down 83 cents this week at $89.78 as of November 13. USDA’s Pork Carcass Cutout was down $5.27 this week to $97.11. The butt and picnic primals were the only reported higher this week, with the belly the main driver to the downside, down $25.79. Weekly pork production was up 1.3% from the previous week but down 0.6% above the same week last year at 563.4 million lbs. That left the YTD pork production up 1% from the same time a year ago, with hog slaughter up 1.5%. Export Sales data indicated net sales of 19,825 MT of pork during the week of November 7. Export shipments were back down from last week at 31,087 MT. Managed money in lean hog futures and options added another 5,374 contracts to extend their new record net long position as of November 12 to a net long 120,961 contracts.
Cotton futures were in freefall mode later in the week, with December dropping 418 points, in the week, a -5.89% move. The weekly Crop Progress report showed 71% of the US cotton crop harvested, 8% ahead of the average pace. Export Sales data showed 153,316 RB of cotton sold during the week of 11/7, a 5-week low. Shipments were 111,964 RB in that week, the lowest in the last 3 weeks. Total commitments for upland cotton are 6.046 million RB, which is 57% of the USDA forecast. Normally sales would be 67% of USDA’s export projection by now. The FSA Adjusted World Price for cotton was back up by 24 points on Thursday, to 58.20 cents/lb. Data from CFTC showed managed money spec funds in cotton futures and options adding 2,934 contracts to their net short as of November 12. By that Tuesday they were net short 13,851 contracts.
Market Watch
Next week is back to a normal schedule with no holidays to work around. The weekly Export Inspections report will be out on Monday morning, with the Crop Progress report out in the afternoon. The weekly EIA Petroleum Status Report out on Wednesday morning. USDA be back to a normal schedule with a Thursday AM Export Sales release. November feeder cattle futures and options will expire on Thursday. On Friday, NASS will release their monthly Cattle on Feed report on Friday, with December grain options expiring that day.
Tech Talk: March Corn
March corn ended the 4 day skid on Friday, with a bounce. That came in a timely manner, as the Thursday close did some damage. We were in a rising regression channel for nearly a month, before spiking out of it on Thursday, the quants did come in and save the day on Friday to buy back into it. That also helped to push things back above the 18 and 40-day moving averages at $4.33 ¼. That area failed to hold on Thursday and suggested turn in the trend. MACD has held it’s bullish ground so far, but is close to flipping, with Stochastics already posting a sell signal. The last line of support was the 2/3 speedline off the brief rally at $4.28 ¾. Breaking that suggests a test of $4.14. The other 2/3 speedline is resistance off the May high is $4.44 ½ and stopped the November rally.
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. All rights reserved.
Leaders. Ag Marketing Report 11/18/2024
We are just over a week past the election and deciding the leader of the free world. Leaders are important for a number of reasons, especially in times of despair. When all hope is gone, there are some who take it upon themselves to turn things around. And this week, the feeders were the true leaders. Among the major ag commodities this week, just the feeder cattle saw any form of strength, as the grains, oilseeds, cotton, the other livestocks, and even the crude oil and gold markets took a hit this week. In this week of increased bearish sentiment, the bulls looked for a leader and found the feeder market, but will it be enough of a rally cry to push the complex higher next week? Only time will tell!
Corn tried to hold some ground this week amid a wheat market that was falling apart, as December was down 7 cents (1.62%). This week’s Crop Progress report showed 95% of the US corn crop harvested by November 10, still running well ahead of the 84% average. EIA data showed record ethanol production in the week of 11/8, up another 8,000 barrels per day to 1.113 million bpd. Stocks of ethanol were up 249just 19,000 barrels to 22.039 million barrels. Export Sales data showed bookings backing off to the lowest in 5 weeks at 1.315 MMT in the week ending on November 7. That took export commitments to 29.901 MMT, a 42% increase over last year. That is also 51% of the US export forecast and now ahead of the average sales pace of 44%. Commitment of Traders data showed managed money adding to their net long by 87,946 contracts in the week that ended on 11/12. That took them to the largest net long in over 20 months at 109,979 contracts.
Wheat piled the pressure on the grains this week as all three exchanges saw sharp losses. Rains this week and more in the forecast put some pressure on the market. Chicago December collapsed by 36 cents (-6.29%) on the week. December Kansas City saw a loss of 24 1/4 cents (-4.30 %) this week. MPLS Dec was down 25 1/2 cents since last Friday (-4.27%). Crop Progress data showed the winter wheat crop at 91% planted by last Sunday, with emergence at 76% of the crop. Condition ratings were tallied at 44% in good/excellent condition, up 3% on the week, as the Brugler500 score was improved by 10 points at 326. Export Sales data showed US export business improving slightly in the week that ended on 11/7 to 380,056 MT. That took export sale commitments to 14.377 MMT, which is 64% of the USDA forecast for exports, still lagging the 67% average selling pace. CFTC’s weekly report showed CBT wheat spec traders increasing their net short position by 14,526 contracts to a net short of 45,307 contracts as of 11/12. In KC wheat, they added another 11,018 contracts to their net short position at 25,098 contracts as of Tuesday.
Soybeans got continued pressure from the products this week, as January was down 31 ¾ cents (-3.08%). Soybean meal saw losses of $6.60 and are exploring new multi-year lows. Bean oil was also a pressure factor, falling 342 points on the week (-7.01%). The pick of Lee Zeldin as head of EPA was seen as less friendly to the market given his history with the RFS. Late in the week bean oil was pulled off its lows with news that China is expected to remove a 13% rebate on exports of used cooking oil. Tuesday’s Crop Progress report showed 96% of the US soybean harvest was complete by 11/10, well ahead of the 91% average pace. NOPA data showed October crush at 199.96 mbu among members, 5.37% above October 2023. Stocks of bean oil were 1.069 billion lbs as of October 31, down 2.8% from last year at this time. Export Sales data showed 2024/25 business backing off to 1.555 MMT. That took the accumulated shipped and unshipped sales to 29.858 MMT. That is 60% of USDA’s expected export total in their WASDE balance sheet, now 5 percentage points back of the average pace. CFTC Commitment of Traders data showed soybean spec traders cutting 15,576 contracts from their net short position as of Tuesday, to 54,536 contracts.
Live cattle extended their pull back this week, with December down just 75 cents this time (-0.41%). Cash trade was mostly $185 this week, a $1-3 drop from the week prior. As stated in the intro, feeders were the leaders, up $5.80 (2.40%) in the January contract this week. The CME Feeder Cattle Index was back up $2.45 week/week to $252.31. Wholesale boxed beef prices backed off again this week, as Choice was down $4.59 (-1.5%) to $303.34, while Select was $3.05 lower (-1.1%) to $276.14. Weekly beef production was down 2% from the previous week and 1.8% above the same week last year at 525.6 million lbs. That left the YTD beef production down 0.5% from the same time a year ago, with cattle slaughter down 3.7%. Export Sales data showed beef bookings of 14,153 MT, improved from last week’s calendar year low. Shipments were tallied at 15,845 MT, a 3-week high. Commitment of Traders data showed managed money in live cattle futures and options adding 5,479 contracts to their net long at 103,317 contracts as of 11/12. Specs in feeder cattle added 685 contracts to their net long at 12,059 contracts as of Tuesday.
Hogs slid another 92 cents this week, as December was down 1.15%. The CME Lean Hog Index was back down 83 cents this week at $89.78 as of November 13. USDA’s Pork Carcass Cutout was down $5.27 this week to $97.11. The butt and picnic primals were the only reported higher this week, with the belly the main driver to the downside, down $25.79. Weekly pork production was up 1.3% from the previous week but down 0.6% above the same week last year at 563.4 million lbs. That left the YTD pork production up 1% from the same time a year ago, with hog slaughter up 1.5%. Export Sales data indicated net sales of 19,825 MT of pork during the week of November 7. Export shipments were back down from last week at 31,087 MT. Managed money in lean hog futures and options added another 5,374 contracts to extend their new record net long position as of November 12 to a net long 120,961 contracts.
Cotton futures were in freefall mode later in the week, with December dropping 418 points, in the week, a -5.89% move. The weekly Crop Progress report showed 71% of the US cotton crop harvested, 8% ahead of the average pace. Export Sales data showed 153,316 RB of cotton sold during the week of 11/7, a 5-week low. Shipments were 111,964 RB in that week, the lowest in the last 3 weeks. Total commitments for upland cotton are 6.046 million RB, which is 57% of the USDA forecast. Normally sales would be 67% of USDA’s export projection by now. The FSA Adjusted World Price for cotton was back up by 24 points on Thursday, to 58.20 cents/lb. Data from CFTC showed managed money spec funds in cotton futures and options adding 2,934 contracts to their net short as of November 12. By that Tuesday they were net short 13,851 contracts.
Market Watch
Next week is back to a normal schedule with no holidays to work around. The weekly Export Inspections report will be out on Monday morning, with the Crop Progress report out in the afternoon. The weekly EIA Petroleum Status Report out on Wednesday morning. USDA be back to a normal schedule with a Thursday AM Export Sales release. November feeder cattle futures and options will expire on Thursday. On Friday, NASS will release their monthly Cattle on Feed report on Friday, with December grain options expiring that day.
Tech Talk: March Corn
March corn ended the 4 day skid on Friday, with a bounce. That came in a timely manner, as the Thursday close did some damage. We were in a rising regression channel for nearly a month, before spiking out of it on Thursday, the quants did come in and save the day on Friday to buy back into it. That also helped to push things back above the 18 and 40-day moving averages at $4.33 ¼. That area failed to hold on Thursday and suggested turn in the trend. MACD has held it’s bullish ground so far, but is close to flipping, with Stochastics already posting a sell signal. The last line of support was the 2/3 speedline off the brief rally at $4.28 ¾. Breaking that suggests a test of $4.14. The other 2/3 speedline is resistance off the May high is $4.44 ½ and stopped the November rally.
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. All rights reserved.