Good Morning from Allendale, Inc. with the early morning commentary for June 28, 2019.
Grain markets are mixed as warm weather across key production states ease fears of potential crop damage. Traders are also positioning for today's USDA acreage and quarterly stocks report, with little managed fund activity as weather maps remain wet over the next few weeks.
Weekly export sales showed corn sales of 405,000 tonnes (estimated 250,000 to 750,000 tonnes), soybean sales of 487,800 tonnes (estimated 300,000 to 800,000 tonnes) and wheat sales of 612,000 tonnes (estimated 200,000 to 500,000 tonnes). Soymeal sales 69,700 tonnes (estimated 75,000 to 250,000 tonnes) and soyoil sales of 19,200 tonnes (estimated 5,000 to 25,000 tonnes). Beef sales of 15,111 metric tonnes (18% below last year) with YTD sales of 549,763 metric tonnes (1% below last year). Pork export sales of 29,717 metric tonnes (22% over last year) with YTD sales of 900,681 metric tonnes (27.5% above last year).
President Trump has agreed to no preconditions for his meeting with Chinese President Xi Jinping this weekend and is maintaining his threat to impose new tariffs on Chinese goods, White House economic adviser Larry Kudlow said. "President Trump looks forward to the meeting. We believe it’s quite possible if the meeting goes well that the Chinese will come back to the negotiating table and we might be able to pick up where we left off in May", said Kudlow. President Trump is set to meet President Xi Jinping for talks in Osaka, Japan at 11:30 a.m. (9:30 p.m. CDT) tomorrow.
First notice day for July contracts is today. Long positions still held are subject to delivery.
Reuters complied average estimates for today’s USDA Quarterly Grain Stocks report. They see corn at 5.332 billion bushels, soybeans at 1.861, and wheat at 1.100.
Analyst estimates for corn plantings on the Planted Acreage report are 86.662 million acres of corn (89.800 million acres June WASDE, 92.792 million acres March forecast). Soybean plantings average estimate at 84.355 million acres (84.600 million acres June WASDE, 84.617 million acres March forecast). All wheat plantings average estimate at 45.654 million acres (45.800 million acres June WASDE, 45.754 million acres March forecast).
International Grains Council (IGC) cut its forecast for world corn and soybean crops after heavy rains disrupted plantings in the U.S. They cut its global corn crop forecast by 23 million tonnes to 1.095 billion tonnes. The IGC pegged the U.S. corn crop at 333.5 million tonnes (362.4 million last report, 366.3 million last year). The council cut its forecast for global soybean production to 349 million tonnes (358 million last report). They increased world wheat production to 769 million tonnes (766 million tonnes last report) reflecting upward revisions for India, the EU and Ukraine.
The U.S. will not reach a trade agreement with the European Union if agriculture is not included, Ted McKinney, a senior U.S. Ag. Department official told reporters. He also said some European countries were expressing interest in acceptance of gene editing, a new technology that he said could sharply increase crop yields.
USDA Quarterly Hogs and Pigs report showed All Hogs (June 1) at 103.6% (103.0% average estimate), Kept for Breeding at 101.4% (102.1% average estimate) and Kept for Marketing at 103.9% (103.1% average estimate).
Dressed beef values were lower with choice down 0.67 and select down 1.66. The CME feeder index is 131.87. Pork cut-out values were up 0.22.