Good Morning from Allendale, Inc. with the early morning commentary for February 21, 2020.
Grain markets are mixed overnight as traders continue to weigh the concern of slowing demand amid coronavirus vs. the expectation that the Chinese will fulfill their Phase 1 purchase commitments. USDA's annual conference will garner some attention as it wraps-up today.
USDA's acreage numbers in yesterday's Ag Forum were mostly along expectations. Corn acres are estimated at 94.0 million, soybeans 85.0, and wheat 45.0. As a reminder, next month's Prospective Plantings report will include actual producer survey data and should reflect more accurate numbers.
Mainland China reported 889 new confirmed cases of coronavirus overnight, a jump from the 394 cases reported the previous day. 118 new deaths were reported as well.
The U.S. government expects China to honor its commitments to buy more U.S. goods under a trade deal signed by the world's two largest economies in January despite the fast-spreading coronavirus outbreak, a senior U.S. official said on Thursday. (Reuters)
Weekly export sales will be released this morning at 7:30 AM CST. Analysts expect to see corn sales of 700,000 to 1,200,000 tonnes, soybeans 600,000 to 1,200,000, wheat 400,000 to 700,000, soymeal 200,000 to 400,000, and soyoil 15,000 to 45,000.
Weekly ethanol production rose from 1.033 million barrels per day to now 1.040. Year to date production has now rebounded to 0.3% under last year. We should meet USDA estimate of a 0.9% increase. This could be due in part to the worse conversion rates this year as well as the expectation the phase one deal will include ethanol and ddg exports.
China said it would ban imports of poultry and poultry products from Slovenia, Hungary, Germany and Ukraine due to bird flu outbreaks, according to a customs statement on Friday. (Reuters)
Average estimates for today’s Cattle on Feed report are On Feed as of Feb 1 2.4% above last year, January placements 1.5% above last year, and January Marketings 0.7% above last year.
Allendale expects Cold Storage to show a 659 million pound total pork stock level for the end of January. Beef stocks are estimated at 492 million pounds.
Cash cattle traded mostly at $120 with some light $119 this week. Dressed, most pricing was $190 though bids were raised to $191 in one location. Last week’s trade averaged $119 and $190 respectively.
USDA's outlook this week also had data for livestock. The 27.480 billion pound beef production estimate was the same as that from 2/11. It is 1.2% over last year. This number is right next to our own 27.510 estimate.
2020 pork production is estimated at 28.885 billion pounds by USDA. That is 4.5% over last year’s record. Allendale sees 2020 at 28.688 billion.
Actual Slaughter suggests the average dressed barrow/gilt at 214 lbs for the week ending 02/08. That was unchanged from the prior week. On a year/year basis there was no change at +0.5%. This new data runs contrary to the Iowa/Southern Minnesota numbers.
Dressed beef values were lower with choice down 1.07 and select down .16. The Feeder cattle index was at 141.95. Pork cut-out values were up .43.