Being a Nebraska football fan is tough. But when you’re born into it you have no choice. An embarrassing statistic that we are not proud of is an 8-year bowl drought. (Yes, when Nebraska last made a bowl game, I was just 2 weeks into my commodity analyst career.) In the last 2 years, they have had plenty of chances to end that drought, losing their last 4 games in 2023 and going on a 4-game skid so far this year. All they have needed in each year is 1 win to make a bowl. There are two more chances this year, so will it happen? Speaking of chances, the bulls have been given plenty in the bean market, but each rally has failed. With that in mind, the August lows have for the most part held, as they did in the wheats. Bulls in the livestock markets have taken the chances to rally seriously.
Corn bulls were in the middle of a tug-o-war battle with bean and wheat, with the bulls winning and December up 1 ½ cents (0.35%) on the week. EIA data showed ethanol production backing off from the previous week’s record in the week of 11/15 by 3,000 barrels per day to 1.11 million bpd. Stocks of ethanol were up 524,000 barrels to 22.563 million barrels. Export Sales data showed bookings back up from the week prior to 1.495 MMT in the week ending on November 14. That took export commitments to 31.396 MMT, a 39% increase over last year. That is also 53% of the US export forecast and now ahead of the average sales pace of 46%. Actual inspections data has shipments at 9.062 MMT for the marketing year, which is 31.88% larger year/year. CFTC showed managed money adding 4,639 contracts to their net in the week that ended on 11/19 per Commitment of Traders data. That took them to net long 114,628 contracts.
Wheat saw some recovering after nearing recent lows. Chicago December was back up 7 3/4 cents (1.44%) on the week. December Kansas City posted a gain of 14 1/4 cents (2.64%) this week. MPLS Dec was up 13 3/4 cents since last Friday (2.40%). The market found initial support early in the week, as President Biden gave Ukraine the greenlight to strike within Russian boarders with US made missiles. Ukraine did follow through with several strikes on boarder regions in the following days, giving a reason for the shorts in the wheat market to cover. Crop Progress data showed the winter wheat crop at 94% planted by last Sunday, with emergence at 84% of the crop. Condition ratings were tallied at 49% in good/excellent condition, up 5% on the week, as the Brugler500 score was improved by another 12 points at 338. Export Sales data showed US export business improving by a decent stride in the week that ended on 11/14 to 549,601 MT. That took export sale commitments to 14,939 MMT, which is 67% of the USDA forecast for exports, still lagging the 69% average selling pace. The weekly Commitment of Traders report showed CBT wheat spec traders increasing their net short position by another 6,239 contracts to a net short of 51,546 contracts as of 11/19. In KC wheat, they added another 4,277 contracts to their net short position at 29,375 contracts as of Tuesday.
Soybeans continued to get pressure from the products this week, as January was down another15 cents (-1.5%). Soybean meal was down just 40 cents. Bean oil was the main pressure factor, falling 358 points on the week (-7.89%), for a 7 cent 2-week loss. Daily export sale announcements from FAS this week added up to 1.041 MMT for soybeans between China, Mexico, and unknown destinations. Export Sales data showed 2024/25 business improvement to 1.861 MMT. That took the accumulated shipped and unshipped sales to 31.584 MMT. That is 64% of USDA’s expected export total in their WASDE balance sheet, now 3 percentage points back of the average pace and catching up. Accumulated shipments this year have been 17.48 MMT according to the Inspections data, 9.2% above the same point last year. CFTC data showed soybean spec traders increasing their net short position by 13,165 contracts as of Tuesday, to 67,701 contracts. Managed money in soy meal was near a record net short position at 63,700 contracts, a 36,069 contracts increase on the week.
Live cattle were back up $3.825 this week in the December contract (2.09%). Cash trade was mostly $187 this week, a $2 jump from the week prior. Feeders were again the leaders, up $7.075 (2.86%) in the January contract on the week. The CME Feeder Cattle Index was up another $2.23 week/week to $254.54 to $35.34. Cattle on Feed data showed October placements a 2.286 million head, up 5.35% from last year. October marketings were up 4.65% at 1.845 million head. November 1 on feed inventory came in at a record for the month at 11.986 million head, a 0.25% increase from last year. Wholesale boxed beef prices were mixed this week, as the Chc/Sel spread widened out by $8.14/cwt. Choice was up $4.07 (-1.3%) to $307.41, while Select was $4.07 lower (-1.5%) to $272.07. Weekly beef production was up 4.1% from the previous week at 547.3 million lbs. That left the YTD beef production down just 0.1% from the same time a year ago, with cattle slaughter down 3.3%. Export Sales data showed a total of 14,250 MT of beef sold in the week of 11/14, a 4-week high. Shipments were 16,333 MT, the largest in 7 weeks. Commitment of Traders data showed spec traders in live cattle futures and options adding 5,098 contracts to their net long at 108,415 contracts as of 11/19. Specs in feeder cattle added 1,608 contracts to their net long at 13,667 contracts as of Tuesday.
Hogs bounced back this week, as December was up $2.18 (2.74%). The CME Lean Hog Index was down another $2.34 this week at $87.44 as of November 20. USDA’s Pork Carcass Cutout was down another $5.34 this week to $91.77. Each of the 6 primals were reported lower, with the belly taking the driver’s seat, down $20.70. Weekly pork production was down 2.6% from the previous week at 549.9 million lbs. That left the YTD pork production 1.7% from the same time a year ago, with hog slaughter up 1.2%. Thursday’s Export Sales report showed 18,060 MT of pork sold for 2024 shipment in the week of 11/14, with 2,459 MT for 2025. Shipments were tallied at 31,975 MT, an improvement from last week. Managed money in lean hog futures and options trimmed back 5,371 contracts from their previous record net long position as of November 19 to 115,590 contracts.
Cotton futures were in recovery mode, with December up 485 points and March up 186 points. The twice a month Cotton Ginnings report from NASS showed 2.157 million RB of cotton was ginned from the 1st of November to the 15th, taking the marketing year total to 6.852 million RB, up 20% from the same period in 2023. The weekly Crop Progress report showed 77% of the US cotton crop harvested, 5% ahead of the average pace. Export Sales data showed a MY high of 318,516 RB of cotton sold during the week of 11/14. Shipments were also improved, to 148,215 RB in that week, the third largest weekly total on the MY. Total commitments for upland cotton are 6.364 million RB, which is 60% of the USDA forecast. Normally sales would be 68% of USDA’s export projection by now. The FSA Adjusted World Price for cotton was back down 229 points on Thursday, to 55.91 cents/lb. Data from CFTC showed managed money spec funds in cotton futures and options adding 22,136 contracts to their net short as of November 19. By that Tuesday they were net short 35,987 contracts.
Market Watch
Next week starts out with the trade reacting to this week’s Cattle on Feed report. Monday morning, the weekly Export Inspections report will be released, with the Crop Progress report out in the afternoon. The monthly Cold Storage report will also be released that afternoon. Skip ahead to Wednesday and the weekly EIA Petroleum Status Report will be published. The market will be closed on Thursday due to Thanksgiving, which will push back the weekly Export Sales release to Friday. Friday is first notice day for December grain futures, as well as a shortened session from the CME, with a hard 8:30 am CST open and early close.
Tech Talk: January Soybeans
January soybeans got a bounce on Friday, which was an convenient spot for buyers to step in. Since the August low at $9.73 ½, Jan has underwent a handful of retests, with each holding. Friday’s low at $9.75 ¼ was the closest we have been. Breaking below that likely indicates a test of the uptrend line off the weekly continuation chart at $9.43 ½. With that said, the oversold stochastics does argue for a bounce here. Lower BB support is $9.73 ¼, with the upper BB resistance at $10.29 ¼. A downtrend line is resistance at 10.20 ½.
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.
Chances. Ag Marketing Report 11/25/2024
Being a Nebraska football fan is tough. But when you’re born into it you have no choice. An embarrassing statistic that we are not proud of is an 8-year bowl drought. (Yes, when Nebraska last made a bowl game, I was just 2 weeks into my commodity analyst career.) In the last 2 years, they have had plenty of chances to end that drought, losing their last 4 games in 2023 and going on a 4-game skid so far this year. All they have needed in each year is 1 win to make a bowl. There are two more chances this year, so will it happen? Speaking of chances, the bulls have been given plenty in the bean market, but each rally has failed. With that in mind, the August lows have for the most part held, as they did in the wheats. Bulls in the livestock markets have taken the chances to rally seriously.
Corn bulls were in the middle of a tug-o-war battle with bean and wheat, with the bulls winning and December up 1 ½ cents (0.35%) on the week. EIA data showed ethanol production backing off from the previous week’s record in the week of 11/15 by 3,000 barrels per day to 1.11 million bpd. Stocks of ethanol were up 524,000 barrels to 22.563 million barrels. Export Sales data showed bookings back up from the week prior to 1.495 MMT in the week ending on November 14. That took export commitments to 31.396 MMT, a 39% increase over last year. That is also 53% of the US export forecast and now ahead of the average sales pace of 46%. Actual inspections data has shipments at 9.062 MMT for the marketing year, which is 31.88% larger year/year. CFTC showed managed money adding 4,639 contracts to their net in the week that ended on 11/19 per Commitment of Traders data. That took them to net long 114,628 contracts.
Wheat saw some recovering after nearing recent lows. Chicago December was back up 7 3/4 cents (1.44%) on the week. December Kansas City posted a gain of 14 1/4 cents (2.64%) this week. MPLS Dec was up 13 3/4 cents since last Friday (2.40%). The market found initial support early in the week, as President Biden gave Ukraine the greenlight to strike within Russian boarders with US made missiles. Ukraine did follow through with several strikes on boarder regions in the following days, giving a reason for the shorts in the wheat market to cover. Crop Progress data showed the winter wheat crop at 94% planted by last Sunday, with emergence at 84% of the crop. Condition ratings were tallied at 49% in good/excellent condition, up 5% on the week, as the Brugler500 score was improved by another 12 points at 338. Export Sales data showed US export business improving by a decent stride in the week that ended on 11/14 to 549,601 MT. That took export sale commitments to 14,939 MMT, which is 67% of the USDA forecast for exports, still lagging the 69% average selling pace. The weekly Commitment of Traders report showed CBT wheat spec traders increasing their net short position by another 6,239 contracts to a net short of 51,546 contracts as of 11/19. In KC wheat, they added another 4,277 contracts to their net short position at 29,375 contracts as of Tuesday.
Soybeans continued to get pressure from the products this week, as January was down another15 cents (-1.5%). Soybean meal was down just 40 cents. Bean oil was the main pressure factor, falling 358 points on the week (-7.89%), for a 7 cent 2-week loss. Daily export sale announcements from FAS this week added up to 1.041 MMT for soybeans between China, Mexico, and unknown destinations. Export Sales data showed 2024/25 business improvement to 1.861 MMT. That took the accumulated shipped and unshipped sales to 31.584 MMT. That is 64% of USDA’s expected export total in their WASDE balance sheet, now 3 percentage points back of the average pace and catching up. Accumulated shipments this year have been 17.48 MMT according to the Inspections data, 9.2% above the same point last year. CFTC data showed soybean spec traders increasing their net short position by 13,165 contracts as of Tuesday, to 67,701 contracts. Managed money in soy meal was near a record net short position at 63,700 contracts, a 36,069 contracts increase on the week.
Live cattle were back up $3.825 this week in the December contract (2.09%). Cash trade was mostly $187 this week, a $2 jump from the week prior. Feeders were again the leaders, up $7.075 (2.86%) in the January contract on the week. The CME Feeder Cattle Index was up another $2.23 week/week to $254.54 to $35.34. Cattle on Feed data showed October placements a 2.286 million head, up 5.35% from last year. October marketings were up 4.65% at 1.845 million head. November 1 on feed inventory came in at a record for the month at 11.986 million head, a 0.25% increase from last year. Wholesale boxed beef prices were mixed this week, as the Chc/Sel spread widened out by $8.14/cwt. Choice was up $4.07 (-1.3%) to $307.41, while Select was $4.07 lower (-1.5%) to $272.07. Weekly beef production was up 4.1% from the previous week at 547.3 million lbs. That left the YTD beef production down just 0.1% from the same time a year ago, with cattle slaughter down 3.3%. Export Sales data showed a total of 14,250 MT of beef sold in the week of 11/14, a 4-week high. Shipments were 16,333 MT, the largest in 7 weeks. Commitment of Traders data showed spec traders in live cattle futures and options adding 5,098 contracts to their net long at 108,415 contracts as of 11/19. Specs in feeder cattle added 1,608 contracts to their net long at 13,667 contracts as of Tuesday.
Hogs bounced back this week, as December was up $2.18 (2.74%). The CME Lean Hog Index was down another $2.34 this week at $87.44 as of November 20. USDA’s Pork Carcass Cutout was down another $5.34 this week to $91.77. Each of the 6 primals were reported lower, with the belly taking the driver’s seat, down $20.70. Weekly pork production was down 2.6% from the previous week at 549.9 million lbs. That left the YTD pork production 1.7% from the same time a year ago, with hog slaughter up 1.2%. Thursday’s Export Sales report showed 18,060 MT of pork sold for 2024 shipment in the week of 11/14, with 2,459 MT for 2025. Shipments were tallied at 31,975 MT, an improvement from last week. Managed money in lean hog futures and options trimmed back 5,371 contracts from their previous record net long position as of November 19 to 115,590 contracts.
Cotton futures were in recovery mode, with December up 485 points and March up 186 points. The twice a month Cotton Ginnings report from NASS showed 2.157 million RB of cotton was ginned from the 1st of November to the 15th, taking the marketing year total to 6.852 million RB, up 20% from the same period in 2023. The weekly Crop Progress report showed 77% of the US cotton crop harvested, 5% ahead of the average pace. Export Sales data showed a MY high of 318,516 RB of cotton sold during the week of 11/14. Shipments were also improved, to 148,215 RB in that week, the third largest weekly total on the MY. Total commitments for upland cotton are 6.364 million RB, which is 60% of the USDA forecast. Normally sales would be 68% of USDA’s export projection by now. The FSA Adjusted World Price for cotton was back down 229 points on Thursday, to 55.91 cents/lb. Data from CFTC showed managed money spec funds in cotton futures and options adding 22,136 contracts to their net short as of November 19. By that Tuesday they were net short 35,987 contracts.
Market Watch
Next week starts out with the trade reacting to this week’s Cattle on Feed report. Monday morning, the weekly Export Inspections report will be released, with the Crop Progress report out in the afternoon. The monthly Cold Storage report will also be released that afternoon. Skip ahead to Wednesday and the weekly EIA Petroleum Status Report will be published. The market will be closed on Thursday due to Thanksgiving, which will push back the weekly Export Sales release to Friday. Friday is first notice day for December grain futures, as well as a shortened session from the CME, with a hard 8:30 am CST open and early close.
Tech Talk: January Soybeans
January soybeans got a bounce on Friday, which was an convenient spot for buyers to step in. Since the August low at $9.73 ½, Jan has underwent a handful of retests, with each holding. Friday’s low at $9.75 ¼ was the closest we have been. Breaking below that likely indicates a test of the uptrend line off the weekly continuation chart at $9.43 ½. With that said, the oversold stochastics does argue for a bounce here. Lower BB support is $9.73 ¼, with the upper BB resistance at $10.29 ¼. A downtrend line is resistance at 10.20 ½.
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.