Earlier this week, while in a meeting with clients, I had a question about if Santa was going to be stopping by this year, at least in the form of a grains rally, heading into Christmas. The answer had mixed reviews, though the late week action among the corn, beans, and wheat, specifically corn, did help matters. At least things look a little better than earlier in the week. From a seasonal perspective, we do typically get some sort of strength from Thanksgiving to Christmas, those some years do move counter to that seasonal. While, we may not be just quite sure if he will be coming this year, let’s at least hope his elves don’t drop off some coal in the meantime.
Corn was back higher this week with March gaining 7 cents (1.62%) this week. EIA data showed ethanol production slipping back from the previous record to 1.073 million barrels per day in the week of 11/29, down 46,000 bpd from the previous week. Stocks of ethanol were up another 134,000 barrels to 23.003 million barrels. Monthly Grain data for October showed corn grind at 460.49 mbu of corn for ethanol production. That was down 0.4% from last year but a 3% hike from the previous month. Weekly Export Sales data showed corn sales for 2024/25 back up from the week prior to 1.732 MMT in the week ending on November 28. That took export commitments to 34.191 MMT, a 31% increase over last year. That is also 58% of the US export forecast and now ahead of the average sales pace of 50%. October export data showed 4.05 MMT (159.4 mbu) of corn shipped according to Census. That was the largest total for the month since 2018 but down 5.39% from September. Commitment of Traders data showed spec funds in corn futures and options trimming their net long by another 9,222 contracts as of 12/3. They held a net long of 88,220 contracts on Tuesday.
Wheat was back up this week across the three markets. Chicago March was back up 9 1/4 cents (1.69%) on the week. March Kansas City posted a gain of 13 cents (2.40%) this week to lead the charge to the upside this week. MPLS March was 4 3/4 cents higher since last Friday (0.8%). This week’s Export Sales report showed US wheat export business back up from a 9-week low to 378,232 MT for the week of 11/28. That took export sale commitments to 15.698 MMT, which is 70% of the USDA forecast for exports, still lagging the 73% average selling pace. Census data indicated all wheat shipments during October at 1.42 MMT (52.3 mbu). That was down 42% from September but up 37.76% from last year and a 4-year high for the month. The weekly Commitment of Traders report from CFTC tallied spec traders adding another 10,268 contracts to their CBT wheat net short at 69,386 contracts by Tuesday 12/3, the largest since August. In KC wheat, they increased their net short by 7,769 contracts to 38,430 contracts.
Soybeans snuck out some gains this week, with January up 4 ¼ cents (0.43%). Soybean meal was back down $4.20 (1.41%). Bean oil was again a supportive factor this week, up 115 points (2.73%). Fats & Oils data showed 215.76 mbu of soybeans crushed for bean oil during October, which was an all-time record. That was 15.7% above the September crush and 7.15% above last year. Soybean oil stocks totaled 1.485 billion lbs, a 1.1% from last year and last month. Thursday’s Export Sales report showed 2024/25 business at 2.313 MMT. That took the accumulated shipped and unshipped sales to 36.185 MMT. That is 73% of USDA’s expected export total for the marketing year, now 1 percentage point ahead of the average pace. October trade data released by Census showed 9.426 MMT (346.4 mbu) of soybeans shipped in the month, slightly above the same month last year and well above the September total. Commitment of Traders data showed managed money trimming 9,255 contracts from their net short in soybean futures and options as of 12/3. That position stood at 72,217 contracts by Tuesday.
Live cattle were back down $2.45 this week in the February contract (1.30%). Cash trade was mostly $191 in the South this week, a $1 increase from the week prior, with the North steady to $1 higher at $191-192. Feeders were again the leaders, this time to the downside, down $3.65 (1.41%) in the January contract on the week. The CME Feeder Cattle Index shot up another $6.63 week/week to $261.83. Wholesale boxed beef prices were stronger this week, as the Chc/Sel spread narrowed to $35.31/cwt. Choice was up $1.52 (0.5%) to $312.04, while Select was $2.43 higher (0.9%) to $276.73. Weekly Export Sales data showed just 138 MT of beef sold for 2024 export, with 13,706 MT sold for 2025 in the week of 11/28. Shipments totaled 14,383 MT in that week, a 4-week low. Monthly trade data from Census tallied October beef exports at 241.1 million lbs when converted to a carcass basis, slightly below the same month last year. CFTC Commitment of Traders data showed spec funds adding 7,004 contracts to their net long at 122,400 contracts in live cattle futures and options as of Tuesday. In Feeder cattle, managed money added 2,119 contracts to their net long as of 12/3 to 18,854 contracts.
Hogs were higher again this week, as December was up 42 cents (0.56%). The CME Lean Hog Index was down another $1.58 this week at $83.93 as of December 4. USDA’s Pork Carcass Cutout was up a slight 85 cents this week to $91.16, mainly on the Friday move. Just the loin, picnic, and ham primals were reported higher, led by the picnic, up $10.11. Thursday’s Export Sales data showed 35,163 MT of pork sold for 2024 in the week of 11/28, with 26,560 MT for 2025 shipment. Export shipments totaled 32,154 MT, which was a 4-week high. October export data was released by Census showed pork shipments at 582.8 million lbs. That is the second largest October total on record and up 1.8% from last year and 6.1% from September. The large managed money spec traders in lean hog futures and options added 8,746 contracts to extend their record net long as of 12/3. They took the record exposure to 133,507 contracts by Tuesday.
Cotton futures reverted back lower this week, as March futures were down 182 points (2.53%). USDA’s monthly Cotton Systems report showed 180 RB of domestic cotton consumed during October. Stocks at the end of October totaled 554 RB. This week’s Export Sales report showed cotton sales back down from last week’s MY high at 170,663 RB of cotton sold in the week of 11/28. Shipments were tallied at the third largest this MY of 157,546 RB. That is also 65% of the USDA forecast, compared to the normal sales pace of would be 71% of USDA’s export projection by now. October Census data showed cotton shipments excluding linters at 573,156 bales, which was a 14.06% increase from last month and 45.36% above October 2023 and a 4-year high. The FSA Adjusted World Price for cotton was up another 21 points this week, to 57.74 cents/lb. Weekly Commitment of Traders data showed managed money trimming another 3,618 contracts from their net short in cotton futures and options as of 12/3. They took that net position to 16,383 contracts as of last Tuesday.
Market Watch
We start next week with the Monday morning Export Inspections report per normal. Monday is also first notice day for December Live Cattle futures. USDA will be out with their monthly WASDE and Cotton Ginnings reports on Tuesday morning. Fast forward to Wednesday and the weekly EIA Petroleum Status Report will be released, as well as the monthly CPI data. PPI data will be out on Thursday morning, as will the weekly Export Sales release. Friday is the last trading day for December corn, bean meal, bean oil, and wheat futures, as well as December lean hog futures and options.
Tech Talk: December Corn
We hit March corn last week, but considering there were some changes this week, we’ll give it a run back. At this time last week, we had just broken the neckline of a head and shoulders top pointing to $4.11 and failed to get back above the neckline. With that said, the 100-day moving average at $4.27 ¾ held, as well as the 61.8% fib retracement at $4.26 ¾. We started out the week with several failed retest of the neckline, which usually indicates the bears are defending that and to look for a test of the downside count. However, Thursday and Friday price action has different agendas. Thursday started out with a test of the uptrend line support at $4.27 ¾ and the 100-day moving average and ended with a bullish engulfing line. The 18-day moving average held at $4.345. However, Friday rallied through that, as well as the previously broken H&S top neckline. Now, if we can break the right shoulder at $4.42 ¼, the H&S is no more. The 2/3 speedline off the May high was also broken on Friday after a couple tests in November. There is a downtrend line at $4.445, with the October high at $4.52 ¼ as lateral resistance. Breaking through those would suggest we need to look at the weekly and monthly charts. Stochastics are shifting back to bullish.
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.
Is Santa Coming? Ag Marketing Report 12/09/2024
Earlier this week, while in a meeting with clients, I had a question about if Santa was going to be stopping by this year, at least in the form of a grains rally, heading into Christmas. The answer had mixed reviews, though the late week action among the corn, beans, and wheat, specifically corn, did help matters. At least things look a little better than earlier in the week. From a seasonal perspective, we do typically get some sort of strength from Thanksgiving to Christmas, those some years do move counter to that seasonal. While, we may not be just quite sure if he will be coming this year, let’s at least hope his elves don’t drop off some coal in the meantime.
Corn was back higher this week with March gaining 7 cents (1.62%) this week. EIA data showed ethanol production slipping back from the previous record to 1.073 million barrels per day in the week of 11/29, down 46,000 bpd from the previous week. Stocks of ethanol were up another 134,000 barrels to 23.003 million barrels. Monthly Grain data for October showed corn grind at 460.49 mbu of corn for ethanol production. That was down 0.4% from last year but a 3% hike from the previous month. Weekly Export Sales data showed corn sales for 2024/25 back up from the week prior to 1.732 MMT in the week ending on November 28. That took export commitments to 34.191 MMT, a 31% increase over last year. That is also 58% of the US export forecast and now ahead of the average sales pace of 50%. October export data showed 4.05 MMT (159.4 mbu) of corn shipped according to Census. That was the largest total for the month since 2018 but down 5.39% from September. Commitment of Traders data showed spec funds in corn futures and options trimming their net long by another 9,222 contracts as of 12/3. They held a net long of 88,220 contracts on Tuesday.
Wheat was back up this week across the three markets. Chicago March was back up 9 1/4 cents (1.69%) on the week. March Kansas City posted a gain of 13 cents (2.40%) this week to lead the charge to the upside this week. MPLS March was 4 3/4 cents higher since last Friday (0.8%). This week’s Export Sales report showed US wheat export business back up from a 9-week low to 378,232 MT for the week of 11/28. That took export sale commitments to 15.698 MMT, which is 70% of the USDA forecast for exports, still lagging the 73% average selling pace. Census data indicated all wheat shipments during October at 1.42 MMT (52.3 mbu). That was down 42% from September but up 37.76% from last year and a 4-year high for the month. The weekly Commitment of Traders report from CFTC tallied spec traders adding another 10,268 contracts to their CBT wheat net short at 69,386 contracts by Tuesday 12/3, the largest since August. In KC wheat, they increased their net short by 7,769 contracts to 38,430 contracts.
Soybeans snuck out some gains this week, with January up 4 ¼ cents (0.43%). Soybean meal was back down $4.20 (1.41%). Bean oil was again a supportive factor this week, up 115 points (2.73%). Fats & Oils data showed 215.76 mbu of soybeans crushed for bean oil during October, which was an all-time record. That was 15.7% above the September crush and 7.15% above last year. Soybean oil stocks totaled 1.485 billion lbs, a 1.1% from last year and last month. Thursday’s Export Sales report showed 2024/25 business at 2.313 MMT. That took the accumulated shipped and unshipped sales to 36.185 MMT. That is 73% of USDA’s expected export total for the marketing year, now 1 percentage point ahead of the average pace. October trade data released by Census showed 9.426 MMT (346.4 mbu) of soybeans shipped in the month, slightly above the same month last year and well above the September total. Commitment of Traders data showed managed money trimming 9,255 contracts from their net short in soybean futures and options as of 12/3. That position stood at 72,217 contracts by Tuesday.
Live cattle were back down $2.45 this week in the February contract (1.30%). Cash trade was mostly $191 in the South this week, a $1 increase from the week prior, with the North steady to $1 higher at $191-192. Feeders were again the leaders, this time to the downside, down $3.65 (1.41%) in the January contract on the week. The CME Feeder Cattle Index shot up another $6.63 week/week to $261.83. Wholesale boxed beef prices were stronger this week, as the Chc/Sel spread narrowed to $35.31/cwt. Choice was up $1.52 (0.5%) to $312.04, while Select was $2.43 higher (0.9%) to $276.73. Weekly Export Sales data showed just 138 MT of beef sold for 2024 export, with 13,706 MT sold for 2025 in the week of 11/28. Shipments totaled 14,383 MT in that week, a 4-week low. Monthly trade data from Census tallied October beef exports at 241.1 million lbs when converted to a carcass basis, slightly below the same month last year. CFTC Commitment of Traders data showed spec funds adding 7,004 contracts to their net long at 122,400 contracts in live cattle futures and options as of Tuesday. In Feeder cattle, managed money added 2,119 contracts to their net long as of 12/3 to 18,854 contracts.
Hogs were higher again this week, as December was up 42 cents (0.56%). The CME Lean Hog Index was down another $1.58 this week at $83.93 as of December 4. USDA’s Pork Carcass Cutout was up a slight 85 cents this week to $91.16, mainly on the Friday move. Just the loin, picnic, and ham primals were reported higher, led by the picnic, up $10.11. Thursday’s Export Sales data showed 35,163 MT of pork sold for 2024 in the week of 11/28, with 26,560 MT for 2025 shipment. Export shipments totaled 32,154 MT, which was a 4-week high. October export data was released by Census showed pork shipments at 582.8 million lbs. That is the second largest October total on record and up 1.8% from last year and 6.1% from September. The large managed money spec traders in lean hog futures and options added 8,746 contracts to extend their record net long as of 12/3. They took the record exposure to 133,507 contracts by Tuesday.
Cotton futures reverted back lower this week, as March futures were down 182 points (2.53%). USDA’s monthly Cotton Systems report showed 180 RB of domestic cotton consumed during October. Stocks at the end of October totaled 554 RB. This week’s Export Sales report showed cotton sales back down from last week’s MY high at 170,663 RB of cotton sold in the week of 11/28. Shipments were tallied at the third largest this MY of 157,546 RB. That is also 65% of the USDA forecast, compared to the normal sales pace of would be 71% of USDA’s export projection by now. October Census data showed cotton shipments excluding linters at 573,156 bales, which was a 14.06% increase from last month and 45.36% above October 2023 and a 4-year high. The FSA Adjusted World Price for cotton was up another 21 points this week, to 57.74 cents/lb. Weekly Commitment of Traders data showed managed money trimming another 3,618 contracts from their net short in cotton futures and options as of 12/3. They took that net position to 16,383 contracts as of last Tuesday.
Market Watch
We start next week with the Monday morning Export Inspections report per normal. Monday is also first notice day for December Live Cattle futures. USDA will be out with their monthly WASDE and Cotton Ginnings reports on Tuesday morning. Fast forward to Wednesday and the weekly EIA Petroleum Status Report will be released, as well as the monthly CPI data. PPI data will be out on Thursday morning, as will the weekly Export Sales release. Friday is the last trading day for December corn, bean meal, bean oil, and wheat futures, as well as December lean hog futures and options.
Tech Talk: December Corn
We hit March corn last week, but considering there were some changes this week, we’ll give it a run back. At this time last week, we had just broken the neckline of a head and shoulders top pointing to $4.11 and failed to get back above the neckline. With that said, the 100-day moving average at $4.27 ¾ held, as well as the 61.8% fib retracement at $4.26 ¾. We started out the week with several failed retest of the neckline, which usually indicates the bears are defending that and to look for a test of the downside count. However, Thursday and Friday price action has different agendas. Thursday started out with a test of the uptrend line support at $4.27 ¾ and the 100-day moving average and ended with a bullish engulfing line. The 18-day moving average held at $4.345. However, Friday rallied through that, as well as the previously broken H&S top neckline. Now, if we can break the right shoulder at $4.42 ¼, the H&S is no more. The 2/3 speedline off the May high was also broken on Friday after a couple tests in November. There is a downtrend line at $4.445, with the October high at $4.52 ¼ as lateral resistance. Breaking through those would suggest we need to look at the weekly and monthly charts. Stochastics are shifting back to bullish.
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.