Good Morning! From Allendale, Inc. with the early morning commentary for August 28, 2018.
Grain markets are cautiously optimistic about the prospect of the US getting trade deals done, but pressure is coming from the idea of a big US crop. Seasonally, this downward momentum is also caused by producers required to clean out the bins and get ready for this year’s harvest.
Allendale’s Annual Yield Survey continues this week through Friday. Participate in the survey by clicking here. You know your field better than anyone! We will be releasing the survey results during a live webinar (Register Here) on September 5. You can also share the results of your farm by calling us at 800-262-7538.
The United States and Mexico agreed on Monday to overhaul the North American Free Trade Agreement (NAFTA), putting pressure on Canada to agree to new terms on auto trade and dispute settlement rules to remain part of the three-nation pact. (Reuters)
Crop progress out yesterday afternoon, reported corn 68% Good to Excellent, inline with last week and the trade estimate. The soybean crop GTE increased to 66%, analysts were expected the crop to be even with last week at 65% GTE. Spring wheat harvest was reported at 77% complete, just behind the 78% estimate.
China plans to release state reserves of wheat as bad weather has limited the countries production. The grain administration claims that the reserves were plentiful and that the market would remain fully supplied.
Export inspections for the week ending August 23rd reported wheat exports of 488,187 tonnes, corn 1,245,130, and soybean of 901,620. The corn and wheat numbers were within expectations, while the soybean number was a little bit higher than expected.
Managed money funds were estimated sellers of 6,000 corn, 5,500 soybeans, 8,000 wheat, and 5,000 soymeal in yesterday's trade. They were buyers of 3,500 soyoil.
The Trump Administration announced it would make $4.7 billion in payments to U.S. farmers to offset losses from trade battles rippling across the globe. Soybean farmers are slated to get roughly three-fourths of the direct payments, or $3.6 billion, followed by producers of pork, cotton, sorghum, dairy and wheat.
Major U.S. Stock Indices rose Monday as trade tensions calmed, sending the Nasdaq Composite past the 8,000 mark for the first time ever. The S&P 500 gained 0.7%, also on track for a new high. The Dow Jones Industrial Average climbed 257 points, or 1%, to 26,047.
Cattle showlists were counted at 2,900 head below last week. Typically we have a big kill before Labor Day to work around the holiday shutdown. This year, the week we are in may have little to no increase in supply.
Lean hog prices increased sharply after announcements of more cases of African swine fever found in China and with Mexico and US agreeing on NAFTA issues. Lean hog futures finished the trading session up $3.00 to 54.775. The swine fever is also putting downward pressure on soybeans on concerns that the Chinese will need less for feed.
Dressed beef values were higher with choice up .31 and select down 1.03. The CME Feeder Index is 150.64. Pork cutout value is up .81.