Good Morning from Allendale, Inc. with the early morning commentary for February 20, 2019.
Grain markets continue to monitor headlines as trade negotiations between the US and China continue in Washington. Outside markets look to this afternoon's FOMC minutes and tomorrow's economic reports for their next direction.
Commitments of Traders through January 29th (the most recent data due to the government shutdown) had funds selling 38,097 corn contracts to reduce their net long position to 6,261. In soybeans they bought 21,717 to be net short 1,197, and in wheat they sold 13,063 to be net short 22,514. The reports will be caught up with the March 1st release.
Export inspections for the week ending February 14, 2019 had corn exports at 941,811 tonnes, 1,031,294 tonnes of soybeans, and 357,131 tonnes of wheat.
China will continue to rejuvenate the countryside and deepen reform of its agriculture sector, according to a government policy statement published on Tuesday. The statement came as China's economic growth in 2018 hit a 28-year-low, with Beijing entangled in an on-off trade war with Washington. (Reuters)
Brazil's soybean production in the 2018/2019 crop cycle is poised to fall by 4 percent from the previous cycle due to adverse climate conditions, according to the average of 12 estimates in a Reuters poll. Farmers there are expected to harvest 114.6 million tonnes of soybeans, below the record amount of 119.3 million tonnes last year.
Egypt's General Authority for Supply Commodities (GASC) set a tender on Tuesday to buy an unspecified amount of wheat from global suppliers for shipment from April 5-15.
Funds yesterday were estimated sellers of 20,000 corn contracts, 8,500 soybeans, 11,000 wheat, 5,000 soymeal, and 6,500 soyoil.
Cattle showlist numbers were 14,900 head lower this week vs. the previous week.
Funds through January 29th bought 2,906 live cattle contracts to be long 102,432 contracts. They sold 5,003 lean hog contracts and were long 3,039.
Cattle on Feed will be released this Friday, but was originally scheduled for January 19. Allendale expects to see December cattle placements at 3.1% over last year. That would stop the previous three weeks of lower than last year numbers.
Cold Storage will be released on Friday as well for the month of December. We forecast 529.616 million lbs. of beef at the end of December. That would come from a 15 million lb. increase over November. We see 495.968 million lbs. of pork in frozen warehouses at the end of December. That would represent a 12 million lb. decline from November.
The National Food Safety Authority confirmed another case of ASF in a wild boar in Bulgaria. The first finding was noted back in August.
Dressed Beef Values were mixed with choice down .12 and select up 0.54. The CME feeder index is 141.28. Pork cut-out values were down 1.67.