Tour Is Finding Outstanding Yield Potential
Aug 23, 2018
Good Morning! From Allendale, Inc. with the early morning commentary for August 23, 2018.
Grain markets are caught in a perfect storm. Rain arrives in August, increasing the chances for big soybean and corn crops, tariff wars heat up, farmers need to empty bins of old crop supplies, producers need to price basis and price later contracts before August 31 and long positions must move out of the nearby contracts before first notice day. Where can we find a significant bullish fact? Stay tuned, it is coming.
Allendale’s Annual Yield Survey runs through August 31. You know your field better than anyone! We will be releasing the survey results on September 5. Please go to www.allendale-inc.com during that time to share the results of your farm or call us at 800-262-7538.
Weekly Export sales data will be released this morning at 7:30 am CDT. Trade estimates are: Wheat 450,000 to 850,000 mt., Corn old crop 200,000 to 500,000 mt., new crop 700,000 to 1,000,000 mt., Soybeans old crop 100,000 to 300,000 mt. new crop 400,000 to 650,000 mt., Soymeal old crop 100,000 to 200,000 mt. and Soyoil old crop 0 to 20,000 mt. new crop 0 to 5,000 mt.
Ethanol production grew from 1.072 million barrels per day to 1.073 in the latest week. This was 2.0% higher than last year which the total for the 2017/18 marketing year is a 2.9%. The old crop marketing year ends on August 31.
Germany's 2018 grains harvest will fall massively to 35.6 million tonnes from 45.5 million tonnes in 2017 after crops suffered enormously from a drought and heatwave, says a German farmers association. They expect winter wheat production to fall in 2018 by 5.5 mmt from last year.
Cattle on Feed report is due to be released on Friday at 2:00 pm CDT. Trade estimates are: On Feed 104.5%, Placed during July 106.3% and Marketed during July 104.7%, with one extra marketing day in July.
Cash cattle trade had a few head reported at 109 in the South but not enough to establish a trend. The electronic auction sold 286 head at 109.50. Lighter production last week is providing support to product as we approach Labor Day. Demand for primal cuts of beef declines as the seasons change.
October live cattle bounced off the uptrend channel line on Wednesday. Support today is yesterday’s low of 108.30 with resistance at 111.00.
Cash hogs continue to slide as hog supplies outpace slaughter needs. Pork product could catch the eye of the consumer as retailers feature pork over beef in the weeks ahead.
October lean hogs opened below the 50-day moving average and left a gap on the chart from Tuesday's trade, setting up an island top, not a friendly sign. Resistance crosses in the gap near 55.50, support comes in at 53.00.
Dressed beef values were mixed with choice up .47 and select down .11. The CME Feeder Index is 149.84. Pork cutout value is down .29.