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March 2011 Archive for Market Watch

RSS By: Alan Brugler, AgWeb.com

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

March Madness 2011 Edition

Mar 25, 2011

 brulogomed

Market Watch with Alan Brugler
March 25, 2011
March Madness
 
The NCAA basketball tournament has the nickname March Madness but those soon to be 8 remaining teams don’t have a corner on unexpected outcomes or big plays. Cotton futures continued to trade in mostly limit move increments from day to day. Grains and livestock were just manic-depressive, swinging from one extreme to the other under a torrent of destabilizing world news. Gold futures posted new all time highs of $1448.60 on Thursday, as they continue to serve as a haven for the panicked masses.
 
Corn posted a second higher weekly close, up 6 cents despite losing 13 cents on Friday because of pre-weekend profit taking. USDA confirmed a 1 MMT sale of old crop corn to unknown destinations on Friday morning, which was widely assumed to be the Chinese business rumored early in the week. USDA also confirmed a 250,000 MT sale of new crop. The trade “bought the rumor and sold the fact”, preferring to head to the sidelines for the weekend in the face of Middle East uncertainties, and a less than finished reactor situation in Japan. The planting intentions report on Thursday is generally expected to show 91-93 million acres, but which end of the range is critically important to potential supply. The combination of states with increases can also influence potential national yield.
 
The soybean complex was mixed. Soybean futures were down 4 cents per bushel, weighed down by a 2.9% drop in soybean meal futures. Soy oil was up 1.9%, buoyed by tighter than expected Census soy oil stocks that implied more biodiesel use. Global use is also rising, with Argentina and Brazil confirming rising domestic use. Palm oil futures hit a multi-month low on expected production increases in Malaysia and also a planned drop in Indonesia’s export taxes for April. Prices snapped back on Friday, with Chinese futures up for both soy oil and palm oil.
 
Wheat bulls found their footing after a multi-week slide, and built gains of 1.4 to 1.6% to close higher for the second week in a row. Japan returned to the market for more wheat, and a number of other countries also scheduled tenders to take advantage of the price decline since February. That demand came at a time the weather forecasts were either too cold, too wet or too dry for US wheat. It depended on which state you were looking at! The International Grains Council raised projected old crop world production to 649 MMT, and expects 2011 production to reach 673 MMT due primarily to a rebound in the FSU.
 
Cotton futures were up a sharp 2.7% for the week. Old crop was definitely stronger than new crop, which has the benefit of optimism about 2011 production. Old crop stocks are tight, weekly export sales were larger than anticipated, and annualized mill use in the Census report was also larger than USDA has been using. Bulls also noted that there are a number of mills with unfixed call purchases tied to the May futures contract. Gains were limited a little bit by indications of greater resistance to rising yarn prices and textile price hikes. Trade guesses for US planting intentions run from 12.8 to 13.3 million acres.
  
Here are the Friday night closes for the past four weeks, along with the net change for this week vs. the previous week:
 
 

 
Commodity
 
 
 
 
Weekly
Weekly
Month
03/04/11
03/11/11
03/18/11
03/25/11
Change
% Change
May
Corn
$7.28
$6.64
$6.84
$6.90
0.06
0.88%
May
CBOT Wheat
$8.32
$7.19
$7.23
$7.33
0.10
1.42%
May
KCBT Wheat
$9.29
$8.23
$8.43
$8.55
0.12
1.39%
May
MGEX Wheat
$9.65
$8.59
$8.68
$8.81
0.14
1.56%
May
Soybeans
$14.14
$13.35
$13.63
$13.58
0.04
0.31%
May
Soybean Meal
$369.70
$350.00
$367.90
$357.20
10.70
2.91%
May
Soybean Oil
$59.48
$55.90
$55.77
$56.84
1.07
1.92%
Apr
Live Cattle
$114.05
$117.13
$111.65
$118.60
6.95
6.22%
Mar
Feeder Cattle
$129.95
$131.55
$128.00
$131.90
3.90
3.05%
April
Lean Hogs
$88.48
$88.15
$88.33
$92.48
4.15
4.70%
May
Cotton
$212.80
$204.94
$199.12
$204.49
5.37
2.70%
May
Oats
$3.90
$3.51
$3.52
$3.49
0.03
0.85%
May
Rice
$14.19
$13.01
$13.64
$14.30
0.66
4.84%

 
Cattle futures were the biggest loser the prior week, and the biggest gainer this week, jumping 6.2% and taking out the high from two weeks earlier. Cash cattle traded at $190-191 in Nebraska, but cash trade in KS was mostly $115. The futures prices are back to where they were when cash hit $118 two weeks ago. Wholesale prices were lower, with choice boxes down $1.59 or 0.8% for the week on a Friday/Friday basis.
 
Hog futures were up $4.15 per hundred, or 4.7% for the week. Hogs continued their short covering rally ahead of the USDA report, with June futures up $2.52 on Friday alone. Pork cutout value was up 1.05% for the week on a Friday/Friday basis, with ribs showing a big gain. The USDA report itself was fundamentally bearish, showing more market hogs and more sows than expected. The all hog and kept for market numbers were above the largest of the pre-report estimates, as shown in the table below:
 

 
USDA Actual
Trade Avg. Guess
Range of Estimates
All Hogs & Pigs -3/1
100.6
100.0
99.7-100.2
Kept for Breeding
100.5
99.8
99.3-100.5
Kept for Marketing
100.6
99.9
99.7-100.2
Dec-Feb Farrowings
99.4
99.2
98.6-99.6
Dec-Feb Pig Crop
101.4
100.9
100.2-101.7

 The report also confirmed a continued rise in productivity, with 9.8 pigs per litter.
 
Market Watch:  This week will mark the end of the month and the end of the quarter, and end with April Fools Day! Not to belabor the point, but USDA will issue Planting Intentions and Grains Stocks numbers on Thursday morning that have fooled a lot of folks in recent years. We’ll start the week with folks adjusting positions they inherited due to exercise of in-the-money April grain options on Friday. In addition to the Thursday reports, USDA will also release the regular Export Inspections report on Monday and weekly Export Sales report on Thursday morning. March feeder cattle options and futures will expire on Thursday. Friday will mark the expiration of the April Live Cattle options.
 
Looking to enhance your existing Ag Marketing Professional subscription? Add free futures market quotes sent to your cell phone via our Market Monitor service. Or “push” the daily recommendations out to your phone as they happen with Market Messenger 2. Call in consulting service with Alan is also available for a limited number of new customers in our Ag Marketing Professional Premium package. Call our office for details on either service at 402-289-2330.  
 
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. Call 402-697-3623 for information on our individualized subscription and consulting services.
 
 Copyright 2011 Brugler Marketing & Management, LLC

Welcome to Volatility

Mar 18, 2011

 brulogomed

Market Watch with Alan Brugler
March 18, 2011
Welcome to Volatility
 
Traditionally, futures volatility is tied to the growing season, at least in the grains. When things are in the bin or the bag, say November to February, price volatility has typically been at the lowest levels of the year. It picks up during the growing season. If that is the case this year, things are going to get REALLY crazy. Implied volatility in corn peaked at 45% this past week, the highest reading since last October. In March of 2010, it was only around 31%. Cotton implied volatility has been around 60% since mid-February, so corn is still comparatively quiet compared to what COULD happen. Past performance is, of course, not necessarily indicative of future results.
 
Corn prices were 19 cents per bushel higher on Friday night than they were the previous Friday. That would have surprised a lot of folks if you told them you expected that outcome on Tuesday. Low prices cure low prices, and some buyers just couldn’t wait any longer to take advantage of the drop since the beginning of the month. South Korea came in, there were rumors of Chinese buying interest, and the USDA confirmed stronger than expected sales were made in the week ending March 4 at 1.337 MMT (52.6 million bushels) of combined old and new crop sales. A private forecasting firm on Friday projected 2011 corn plantings in the US at 91.758 million acres, regarded as a neutral number.  
 
The soybean complex was mixed. While energy was still a popular topic, it was of the nuclear persuasion. Crude oil kept hanging around $100, but that wasn’t enough to get soy oil higher for the week. Soy meal rallied, pulled higher by corn and the other feed grains. Weekly export sales for soybeans were disappointing, but some firms lowered their projected Brazilian production to 69-70 MMT due to quality problems caused by ongoing heavy rains. China announced the third increase since January 1 in the bank reserve requirements, in another attempt to slow inflation. That didn’t appear to have any impact on the soybean market there, or here. A private forecasting firm estimated soybean acreage this spring will be only 75.269 million bushels. Futures prices did not appear to react to the news, probably because it has been assumed that corn picked up intentions at the expense of beans based on the $6.01 per bushel revenue insurance guarantee price.
 
Wheat futures saw the steep slide grind to a halt and a little bit of a bounce unfold. Prices were up anywhere from .59% to 2.46%. KC was in the bullish lead, thanks to ongoing crop problems in TX and OK that will likely mean some wheat being ripped up and replaced with cotton or milo. HRW wheat also has been in demand for export. Gains were slowed a little by Japan worries, with the MOA buying only about a third of its normal weekly tender, and all of that coming from Canada.
 
Cotton futures continued to be plagued by limit moves almost day, in both directions. Despite the increase in allowable daily moves to 700 points per day, the market appeared to want to be even more volatile. Prices lost 2.8% for the week, but that camouflaged a couple limit up days at the end of the week in the front month futures. Weekly export sales were larger than expected on Thursday morning, which helped boost prices. Dryness continues to plague a swath of the southern cotton belt.
 
Here are the Friday night closes for the past four weeks, along with the net change for this week vs. the previous week:
 

 
Commodity
 
 
 
 
Weekly
Weekly
Month
02/25/11
03/04/11
03/11/11
03/18/11
Change
% Change
May
Corn
$7.22
$7.28
$6.64
$6.84
0.19
2.90%
May
CBOT Wheat
$8.11
$8.32
$7.19
$7.23
0.04
0.59%
May
KCBT Wheat
$8.99
$9.29
$8.23
$8.43
0.20
2.46%
May
MGEX Wheat
$9.29
$9.65
$8.59
$8.68
0.09
1.05%
May
Soybeans
$13.75
$14.14
$13.35
$13.63
0.28
2.10%
May
Soybean Meal
$364.70
$369.70
$350.00
$367.90
17.90
5.11%
May
Soybean Oil
$57.58
$59.48
$55.90
$55.77
0.13
0.23%
Apr
Live Cattle
$114.10
$114.05
$117.13
$111.65
5.47
4.67%
Mar
Feeder Cattle
$129.83
$129.95
$131.55
$128.00
3.55
2.70%
April
Lean Hogs
$90.20
$88.48
$88.15
$88.33
0.17
0.20%
May
Cotton
$184.23
$212.80
$204.94
$199.12
5.82
2.84%
May
Oats
$3.79
$3.90
$3.51
$3.52
0.02
0.43%
May
Rice
$14.31
$14.19
$13.01
$13.64
0.63
4.80%

 
Cattle futures were the biggest loser, sinking 4.67% for the week. Cash cattle prices surged to $118 the previous week from $114, an unusually large jump. They went back where they came from this past week, taking futures with them, and then some. Heavy speculative selling took the spot April $2 past the cash market, trying to anticipate further weakness next week. The wholesale market was up more than 5% for the week, but still comfortably below the 2003 peak. The Friday afternoon Cattle on Feed report was neutral, with March 1 numbers 105% of year ago. While that is yet another month of expansion, it matched the average trade guess exactly. Marketings were on the high side of guesses, while placements were also a little larger.
 
Hog futures eked out a 17 cent gain for the week. Japan’s woes translated into opportunity, with losses of refrigeration and disruptions of slaughter and feeding programs there. They were thought to want more packaged pork products for immediate shipment. On a Thursday/Thursday basis, the pork cutout value was up 1%, or about 9.4 cents per pound. That is a reflection of wholesale demand vs. supply. The preliminary estimate for weekly pork production was down 0.7% from the prior week, but production since January 1 is still about 0.8% larger.
 
Market Watch:  Spring has sprung, or at least it will officially be Spring when traders get back to work on Sunday evening. They will initially be reacting to Friday’s Cattle on Feed report. Livestock reports will be featured this week, with the monthly Cold Storage report due out on Tuesday afternoon, and the quarterly USDA Hogs & Pigs report coming out on Friday afternoon. The Census Crush report will be on Thursday morning, along with Census Cotton Consumption and USDA weekly Export Sales. Friday will also mark the last trading day for April grain options.
 
Looking to enhance your existing Ag Marketing Professional subscription? Add free futures market quotes sent to your cell phone via our Market Monitor service. Or “push” the daily recommendations out to your phone as they happen with Market Messenger 2. Call in consulting service with Alan is also available for a limited number of new customers in our Ag Marketing Professional Premium package. Call our office for details on either service at 402-289-2330.  
 
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. Call 402-697-3623 for information on our individualized subscription and consulting services.
 
 Copyright 2011 Brugler Marketing & Management, LLC

A Shaky Bunch of Markets

Mar 11, 2011

 brulogomed

Market Watch with Alan Brugler
March 11, 2011
A Shaky Bunch of Markets
 
The markets were still in turmoil this week, showing more panic and fear. If there was more greed, it was of the bearish variety. There is an awful lot of red ink on our weekly change table below, with feed grains down 8% or more, and wheat dropping 10 to 13% and thus becoming cheap enough to become a feed grain in the United States. The commodity markets were under pressure early in the week from apparent gains by Gadhafy forces in Libya, threatening to prolong the conflict and thus the oil disruption. A highly touted “day of rage” in Saudi Arabia fizzled, but the markets were building in more risk premium against a flare up. Then, on Friday, the 8.9 earthquake hit Japan and there were tsunami concerns for the first half of the trading day. That just encouraged more longs to cash out and go home for the weekend.
 
Corn lost 8.6% for the week, or 62 cents per bushel. USDA made no change in their US ending stocks or cash price forecasts on Thursday, preferring to wait until they have the Grain Stocks numbers to be released on March 31. The Feed & Residual use category is a derived number, and the grain stocks data is needed to true up the use estimate. The USDA weekly export sales were a very anemic 776,000 MT, with old crop sales dropping off 56% from the previous reporting week. These sales were for the week ending March 3 and thus coming at the time of some of the highest prices for the year.
 
The soybean complex was down, but only 5.77% in the beans and 4.87% in the meal. Soy oil was down 5.89%, but benefitted from the instability in crude oil supplies because so many countries are now using vegetable oils for biodiesel and reducing their exposure to the crude oil market gyrations. Soybean meal dropped along with its feed grain competitors. Soybean export sales were only 470,000 MT, up 14% for the week but limited by increased availability of new crop South American supplies in the world market.
 
Wheat futures were under pressure all week. On Thursday, USDA raised projected global ending stocks to 181.90 MMT. That was up 4.13 MMT or 152 million bushels from the February estimate.   US ending stocks were raised to 843 million bushels, as USDA revised its estimate for 2010/11 exports downward by 25 million bushels. Export commitments continue to run slightly below the pace needed to meet the previous USDA estimate of 1.3 billion bushel. The quantity of HRW export sales on the books is a multi-decade high for this time of year, but there are legitimate questions about whether it can all be moved into position and shipped by May 31.
 
Cotton futures sold off after setting all time highs of 2.27 dollars per pound. USDDA reported solid 2011/12 export sales bookings of 394,100 RB of upland cotton. However, old crop booking through March 3 were down 46% from the previous week. There were small cancellations by China and “unknown” but the biggest factor is the lack of uncommitted old crop cotton to sell. In the WASDE report, USDA made no significant changes to the US balance sheet. Global production was cut slightly, while global use was raised fractionally. The net result was ending stocks up 42.33 million bales. That figure was 1.2% smaller than the February estimate.
 
Here are the Friday night closes for the past four weeks, along with the net change for this week vs. the previous week:
 

 
Commodity
 
 
 
 
Weekly
Weekly
Month
02/18/11
02/25/11
03/04/11
03/11/11
Change
% Change
Mar
Corn
$7.10
$7.12
$7.21
$6.59
0.62
8.60%
Mar
CBOT Wheat
$8.22
$7.77
$8.01
$6.95
1.06
13.18%
Mar
KCBT Wheat
$9.30
$8.88
$9.18
$8.21
0.98
10.62%
Mar
MGEX Wheat
$9.56
$9.16
$9.53
$8.53
1.00
10.47%
Mar
Soybeans
$13.68
$13.66
$14.08
$13.27
0.81
5.77%
Mar
Soybean Meal
$362.00
$359.70
$363.80
$346.10
17.70
4.87%
Mar
Soybean Oil
$56.49
$56.95
$58.96
$55.49
3.47
5.89%
Apr
Live Cattle
$115.15
$114.10
$114.05
$117.13
3.08
2.70%
Mar
Feeder Cattle
$130.08
$129.83
$129.95
$131.55
1.60
1.23%
April
Lean Hogs
$92.28
$90.20
$88.48
$88.15
0.32
0.37%
May
Cotton
$194.93
$184.23
$212.70
$204.94
7.76
3.65%
Mar
Oats
$4.10
$3.69
$3.81
$3.46
0.36
9.32%
Mar
Rice
$14.75
$13.96
$13.91
$12.79
1.12
8.05%

 
Cattle futures were the exception to the rule, up a smart 2.7% for the week. Beef production for the week was down an estimated 1.3% from the prior week, but up 3.4% from the same week in 2010. The main story for the week was the $5 jump in cash cattle prices, with numbers trading at $118 in the south. That is the highest price level since pre-BSE days in 2003. Beef production YTD is up 1.1%, but the export market is draining off some of the surplus beef. USDA reported 10,500 MT of export sales for 2011, with Mexico the largest destination.
 
Hog futures were supported by beef prices, but an apparent slow down in export bookings took the edge off of the wholesale pork market. Nearby April futures were down 0.37% for the week.  Estimated pork production for the week was up 0.7% from last week, and 3.2% larger than the same week in 2010. On a Thursday/Thursday basis, pork cutout value was up 73 cents per hundred. Ham prices started the week about even with last year, but were the worst performing component.
 
Market Watch:  The market will start the week assessing weekend news developments. The two major concerns are any new threats to oil supplies coming from the Middle East and the amount of infrastructure damage done by Friday’s earthquake off of Japan and the resulting tsunami. The latter can affect import needs for reconstruction, and also import restrictions due to port damage. Monday is the last trading day for the March grain futures contracts. NOPA will also issue a monthly Crush report on Monday. The Fed FOMC meets on Tuesday. Thursday will feature the USDA weekly Export Sales report, and a few traders distracted by St. Patrick’s Day festivities. Friday will see USDA monthly Cattle on Feed and Milk Production reports.
 
Upcoming Brugler Webinars: There is a lot more information available on these markets and whether they might go under several different scenarios. To get your head around the swirling fundamentals, sign up for one of our upcoming webinars. The National Ag marketing Strategy Group webinar is on Monday, March 14. We’ll also have a webinar examining the March 31 USDA reports in detail on the evening of March 31. Visit our Webex site to register. Go to http://bruglermktg.webex.com and click on the “Upcoming” tab.
 
Looking to enhance your existing Ag Marketing Professional subscription? Add free futures market quotes sent to your cell phone via our Market Monitor service. Or “push” the daily recommendations out to your phone as they happen with Market Messenger 2. Call in consulting service with Alan is also available for a limited number of new customers in our Ag Marketing Professional Premium package. Call our office for details on either service at 402-289-2330.  
 
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. Call 402-697-3623 for information on our individualized subscription and consulting services.
 
 Copyright 2011 Brugler Marketing & Management, LLC

Its Complicated!

Mar 04, 2011

 brulogomed

Market Watch with Alan Brugler
March 4, 2011
It’s Complicated
 
The markets were in turmoil this week, showing different versions of panic, fear and greed. Crude oil hit a 2 ½ year high, with ongoing reductions in Libyan oil exports. Fighting was intensifying. Gold hit new all time highs as civil unrest and political murders (Pakistan as an example) were seen in a number of countries. While Libya is a relatively small oil producer, the lost production directly affects the EU-27. The refugees from the conflict affect a number of surrounding countries. The US dollar was weaker despite further improvement in unemployment to 8.9%. The main concern appears to be that higher energy prices are a drag on already anemic GDP growth.
 
Corn hit new highs for the year on Friday morning, and continues to chip away at the gap between current prices and the 2008 high. Projected ending stocks are tighter this year than in 2008. While there has been some slowing of ethanol production in the past month, spot margins improved sharply with the Libyan conflict and the associated high oil prices. Corn export sales have been running strong, aided by the weakness in the US dollar and the tightest world coarse grain stocks situation since 2006. The actual USDA number for the week ending February 24 was 1.202 MMT.
 
The soybean complex was higher in all three legs. Soy oil was the leader, with the benefits of biodiesel use more apparent as the Libyan situation spiraled into more destruction of facilities. Trade estimates were 50% light for the weekly USDA Export Sales report. The actual number was 645,300 MT for combined old and new crop bookings. Chinese buying activity picked up in both old crop and new crop. Nearly all of the new crop bookings were for China. Informa updated its projections for Brazilian and Argentine soybean production on Friday, bumping Argentina to 52 MMT and Brazil to 71.5 MMT. The former was definitely larger than the rest of the trade had been expecting, with other estimates mostly in the 48-49 MMT range. That pulled prices back a little on Friday.
 
Wheat futures rebounded after two down weeks, posting higher weekly closes at all three exchanges. Minneapolis was the strongest of the three, up 4.1%. Spring wheat is still directly involved in the Acreage War, while the winter wheat classes traded in Chicago and KC are already planted and any switching is tied to the crop insurance adjustor and the poor crop condition ratings. USDA reported export sales slowed to 650,900 MT. Old crop sales were down 44% from the previous reporting week.
 
Cotton futures hit new all time highs in the front month futures on Friday, and were up a whopping 12.4% for the week. Old crop supplies out of the US are extremely tight, with most bales already committed to either the export market or domestic mills. Weekly export sales from USDA were larger than expected at 411,200 running bales. The US economy continues to improve, with unemployment for February dropping to 8.9%. That hints at better consumer demand over time, although consumer deleveraging continues to limit retail buying interest from what it was three years ago.
 
Here are the Friday night closes for the past four weeks, along with the net change for this week vs. the previous week:
 

 
Commodity
 
 
 
 
Weekly
Weekly
Month
02/11/11
02/18/11
02/25/11
03/04/11
Change
% Change
Mar
Corn
$7.07
$7.10
$7.12
$7.21
0.09
1.30%
Mar
CBOT Wheat
$8.67
$8.22
$7.77
$8.01
0.24
3.09%
Mar
KCBT Wheat
$9.73
$9.30
$8.88
$9.18
0.31
3.44%
Mar
MGEX Wheat
$10.18
$9.56
$9.16
$9.53
0.37
4.07%
Mar
Soybeans
$14.16
$13.68
$13.66
$14.08
0.42
3.09%
Mar
Soybean Meal
$378.10
$362.00
$359.70
$363.80
4.10
1.14%
Mar
Soybean Oil
$58.49
$56.49
$56.95
$58.96
2.01
3.53%
Apr
Live Cattle
$112.70
$115.15
$114.10
$114.05
0.05
0.04%
Mar
Feeder Cattle
$126.03
$130.08
$129.83
$129.95
0.13
0.10%
April
Lean Hogs
$92.38
$92.28
$90.20
$88.48
1.73
1.91%
Mar
Cotton
$189.97
$197.02
$191.34
$215.15
23.81
12.44%
Mar
Oats
$4.18
$4.10
$3.69
$3.81
0.12
3.18%
Mar
Rice
$15.89
$14.75
$13.96
$13.91
0.04
0.32%

 
Cattle futures were down 5 cents for the week, with the two day rally failing to erase early week losses and the 15 cent drop on Friday. The cash cattle market was firm again, with declining ready numbers into March. Packers paid $113, matching the all time record high from 2003. USDA reported weekly export sales of 14,000 MT. The wholesale market was again firmer for the week, with choice boxes up $2.57 and select boxes quoted 1.5% higher on a Thursday/Thursday basis. Beef production for the week was down an estimated 1.6% from the previous week, but up 5.1% from the same week a year ago. For the year, production is up 0.9% despite UNCH slaughter.
 
Hog futures were down 1.9% for the week. Pork production YTD is up 0.5% from 2010, while the estimated production this past week was up 1.3% from the same week in 2010. Average slaughter weights are running persistently higher at 208 pounds vs. 203 a year ago. Wholesale prices were up $1.28 for the week, a 1.4% drop in the carcass value that kept pressure on the cash hog market.
 
Market Watch:  It is time for another USDA supply/demand report, which will be released on Thursday morning. Global changes are expected, with keen interest in the South American corn and soybean production numbers. Wednesday marks the expiration of the March cotton contract. There are routine USDA reports on Export Inspections and Export Sales, which come on Monday and Thursday respectively. Not to be overlooked, Daylight Savings Time begins on Sunday the 13th. Can Spring be far behind? It begins on the 20th.
 
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. Call 402-697-3623 for information on our individualized subscription and consulting services.
 
 Copyright 2011 Brugler Marketing & Management, LLC
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