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RSS By: Alan Brugler, AgWeb.com

Alan Brugler is the President of Brugler Marketing & Management, and the primary analyst and advisor.

A Few Drips of Data

Oct 18, 2013

 Brugler

Market Watch with Alan Brugler

October 18, 2013

A Few Drips of Data

 

They may not have fixed the budget deficit or straightened out Obamacare, but Congress did manage to pass legislation to fund the government for a few months. That got USDA, EIA, CFTC and Commerce employees back to work generating the data we rely upon to make sure buyers and sellers are both equally informed. A few drips of daily cash market data came out of the government tap on Thursday and Friday, along with weekly export sales for the week ending September 26 (originally scheduled for release on October 3). EIA was only out for a week, and will issue a catch up weekly ethanol production report on Monday. Data sets will be ragged and prone to errors for a while, however, particularly from the export sector with its mix of daily and weekly reporting. Some missed numbers won’t be reported in their usual daily or weekly format but only in the aggregate. The data drips will turn into a flood as we round the corner into November.  Expect volatility.

December corn futures were up 1.9% this week. Private analyst Informa projected a drop in 2014 corn plantings to 91.7 million acres. That would imply about 83 million harvested and a potential 13.3 billion bushel crop at trendline yield according to our calculations. Export inspections YTD are now 115.4 million bushel, close to the 117.3 million a year ago. That’s not saying much, given the multi-decade low in shipments last year. Harvest is generally thought to be 30-40% completed, with a bias toward a USDA hike in projected national average yield. USDA will release an updated Crop Progress report on Monday.

November soybean futures were up 24 cents this past week, almost erasing the 28 cents per bushel lost the prior week. Export inspections on Monday jumped to over 47 million bushels. Cumulative shipments are 66 million behind year ago based on updated USDA data. Crush has been constrained by the slow pace of harvest, and there has been strong export demand and domestic feeder demand for soybean meal.  NOPA crush was in fact slightly larger than expected at 108 million bushels. Soy oil stocks were smaller than expected due to active biodiesel production.  Weekly export sales totaled 903,700 MT of 2013/14 and 2014/15 sales in the week ending September 26. USDA did announce 222,000 MT of soybeans sold to China under the daily reporting system, with another 140,000 MT sold to "unknown".  The Argentine ag minister expects 2013/14 soybean plantings there to be up only 600,000 HA from last year.

 

Wheat futures were higher in all three markets. Chicago gained the most ground, up 1.95% due to continued strong export buying interest and the small 2013 production. Cumulative export shipments are now over 550 million bushels. Last year they were only at 377 million bushels. Japan has been a steady buyer of US wheat, along with Brazil. Argentina indicated that its crop might only be 8.8 MMT due to a host of weather problems afflicting the crop.

Cotton futures were down 0.31%. On Friday, USDA issued the weekly export sales report for the week ending September 26. It showed a slow 64,300 MT of upland cotton sold that week, with much stronger Pima sales of 53,000 MT. USDA put the AWP at 68.61 cents per pound. The Cotlook A Index is at 89.95.

 

 

Commodity

 

 

 

 

Weekly

Weekly

Month

09/27/13

10/04/13

10/11/13

10/18/13

Change

% Change

Dec

Corn

$4.54

$4.43

$4.33

$4.42

$0.08

1.90%

Dec

CBOT Wheat

$6.83

$6.87

$6.92

$7.06

$0.14

1.95%

Dec

KCBT Wheat

$7.318

$7.503

$7.603

$7.688

$0.09

1.12%

Dec

MGEX Wheat

$7.32

$7.46

$7.55

$7.60

$0.05

0.73%

Nov

Soybeans

$13.20

$12.95

$12.67

$12.91

$0.24

1.93%

Dec

Soybean Meal

$418.30

$418.40

$403.40

$410.10

$6.70

1.66%

Dec

Soybean Oil

$41.81

$40.24

$40.28

$41.68

$1.40

3.48%

Oct

Live Cattle

$128.25

$128.05

$128.80

$129.88

$1.07

0.83%

Oct

Feeder Cattle

$164.13

$164.45

$167.48

$166.08

($1.40)

-0.84%

Dec

Lean Hogs

$88.13

$87.63

$86.50

$87.95

$1.45

1.68%

Dec

Cotton

$86.69

$86.94

$83.37

$83.11

($0.26)

-0.31%

Dec

Oats

$3.17

$3.18

$3.17

$3.36

$0.19

6.00%

Nov

Rice

$15.40

$14.87

$15.12

$15.29

$0.18

1.16%

 

Cattle futures rose $1.07 cents this week, a 0.8% gain. Cash cattle traded at $130 in the south and $204 in the north, with the latter $4 higher than the previous week. Beef production YTD is down 0.9% from 2012. Production this week was 4% smaller than the same week in 2012.  Our calculations show that ready numbers should be declining into November, based on prior Cattle on Feed placement data.  Weekly slaughter was 614,000 head vs. 639,000 head a year ago. USDA announced that the monthly Cattle on Feed, Livestock Slaughter and Cold Storage reports would all be released on October 31.

Hog futures were down 1.7% this week. Cash market information was limited until Thursday, when AMS quickly got back to work.  Pork production YTD is down 1.3% from year ago. Production this week was 3.8% smaller than the same week in 2012, with slaughter down 3.6%. Thus, you might conclude that average carcass weights were a little lower. USDA shows them down 1 pound. The pork carcass cutout value was $94.30 on Friday, down $7.76 or 7.6% from the last known Friday close on September 27.  Pork bellies typically decline with the end of BLT season and the advent of the fall hog run. This year is no exception, with that component down 26% in 3 weeks. Ribs and hams were down only about 2% during that same period.

Market Watch

USDA reports resumed on Thursday. Some regular reports will be issued on Monday, including Crop Progress and Export Inspections (which were collected all along but not officially summarized). Other data series will be delayed or in "jump ahead to present" mode. The regular weekly Hatchery report will be out on the 23rd, and is supposed to include back data. USDA will not issue October Crop Production or WASDE estimates.

Visit our Brugler web site at http://www.bruglermarketing.com, find our iPad app "AgMarket" in the app store, or call 402-697-3623 for more information on our consulting and advisory services for farm family enterprises and agribusinesses.

 

There is a risk of loss in futures and options trading.  Such trading is not appropriate for all individuals. Past performance is not necessarily indicative of future results.  Comments made in this article are in no way to be seen as an endorsement of futures and options trading. Reproduction or rebroadcast of any portion of this article without written consent of Brugler Marketing & Management LLC is strictly prohibited.  

Copyright 2013 Brugler Marketing & Management, LLC

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