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Market Watch

RSS By: Alan Brugler, AgWeb.com

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

Waiting and Watching

Jul 19, 2013

 

 Brugler

Market Watch with Alan Brugler

July 19, 2013 

Waiting and Watching

September corn futures were down 1 cent per bushel for the week. December didn’t fare as well, down 8 /12 cents as weather patterns and forecasts were sufficiently varied to weaken arguments for major yield losses. Weekly ethanol production dropped off by 5,000 bpd, while ethanol imports rose to 50,000 bpd as Brazil had more early ethanol production due to weather that was not favorable for sugar. Ethanol stocks rose. Weekly export sales also jumped to more than 1.74 MMT, aided by more than 1.2 MMT of new crop corn sold to China. China has also been aggressively buying DDGs from the US. US corn export commitments are now 105% of the amount needed to hit the USDA forecast for the year, which is running ahead of the 5 year average pace of 102%.

Nearby August soybeans gained 62 cents per bushel for the week.  Futures are trying to close the expiration gap left by the July contract, with similar old crop fundamentals going into the August delivery period. November futures were up sharply on Monday and Tuesday following the Three Line Strike candlestick formation the week before. Soybean export commitments are at 102% of the USDA projection for the marketing year vs. the average pace of 103% for this date. Meal bookings are at 100% of the more recent USDA export forecast, a little ahead of the 97% average for this date.

KC Wheat futures ground another 3 cents lower this week. Chicago was the beneficiary of some large export sales to China, but futures were 17 cents lower. Chicago was pressured by competition from new crop harvests in Europe, Russia and Ukraine. Egypt got organized enough to buy 300,000 MT of wheat for late August shipment, but it came from Romania, Russia and Ukraine. USDA reported weekly export sales last week were 996,600 MT. Outstanding export commitments are now 40% of the USDA forecast for the year vs. the 5 year average of 30% for this date. We are off to a good start.  

Cotton futures gained 1.7% for the week. USDA raised projected old crop ending stocks to 3.9 million bales from 3.6 million earlier in the month. Weekly export sales for upland were 90,500 RB. Pima sales were 4,800 RB. Cotton export sales commitments are 105% of the USDA forecast for the year. They would typically be 111% with only 3 weeks left in the marketing year. Texas and the Southeast have been wetter recently, but the forecasts call for much of Texas to go back to the dry side between now and month end.

 

Commodity

 

 

 

 

Weekly

Weekly

Month

06/28/13

07/05/13

07/12/13

07/19/13

Change

% Change

Sep

Corn

$5.47

$5.26

$5.45

$5.44

($0.01)

-0.26%

Sep

CBOT Wheat

$6.58

$6.60

$6.81

$6.65

($0.17)

-2.42%

Sep

KCBT Wheat

$6.7625

$6.858

$7.085

$7.053

($0.03)

-0.46%

Sep

MGEX Wheat

$7.75

$7.64

$7.67

$7.51

($0.16)

-2.09%

Aug

Soybeans

$14.31

$14.32

$14.29

$14.91

$0.62

4.32%

Aug

Soybean Meal

$434.90

$428.60

$442.90

$482.40

$39.50

8.92%

Aug

Soybean Oil

$46.29

$47.11

$46.22

$45.50

($0.72)

-1.56%

Aug

Live Cattle

$122.03

$121.95

$121.85

$121.98

$0.13

0.10%

Aug

Feeder Cattle

$149.45

$151.80

$150.13

$152.25

$2.13

1.42%

Aug

Lean Hogs

$97.45

$97.75

$94.90

$96.48

$1.57

1.66%

Oct

Cotton

$85.61

$86.43

$85.13

$86.52

$1.39

1.63%

Sep

Oats

$3.66

$3.60

$3.52

$3.55

$0.03

0.78%

Sep

Rice

$15.74

$15.18

$15.50

$15.17

($0.33)

-2.13%


Cattle futures were up 13 cents this week, offsetting a 10 cent loss the week before.  Feeders were up $2.13, or 1.4%. Choice beef prices are still reverting to the mean after their record levels in May. Wholesale beef prices were mixed this past week, with Choice down 1.2% and Select up 0.3% on a Friday/Friday basis. USDA reported weekly beef export sales rose to 15,200 MT vs. 14,600 MT the prior week. Weekly beef production was up 1.9% from the previous week, and 0.5% larger than the same week in 2012. YTD beef production is still 0.9% below last year. Estimated carcass weights are running 4-5 pounds above year ago. The USDA Cattle on Feed report on Friday night showed July 1 numbers down 3.2% from year ago. June marketings were larger than expected at 96.4% of year ago, but placements were 95.4% of last year and didn’t offset the marketings.

Hog futures were up 1.66% for the week.  The Estimated weekly slaughter was 2.007 million head. That was down 1.5% from last week, but 2.3% larger than the same week in 2012. Pork production YTD is now down only 0.3%. The pork carcass cutout value lost 2.5% this week after being down 4.25% the previous week. Cash hog prices on Friday afternoon were sharply higher in the west but lower in the east. The IA/MN average was up $1.65.  The WCB average was down $1.55 and the ECB was 11 cents lower. USDA weekly export sales report slowed to 4,100 MT from 6,400 MT the prior week.

Market Watch

Cattle traders will begin the week reacting to the Friday night Cattle on Feed report. They will also get the monthly USDA Cold Storage report data on Monday evening. USDA will issue the usual weekly Export Inspections and Crop Progress reports on Monday. Export Sales report on Thursday morning. Friday will mark the expiration of the August grain options.

Visit our Brugler web site at https://www.bruglermarketing.com or call 402-697-3623 for more information on our consulting and advisory services for farm family enterprises and agribusinesses. 

Attend the Brugler Marketing Summer Seminars on July 24-25 in Omaha and July 29-30 in Richmond, IN. See the agendas on our web site.    

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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