Good Morning from Allendale, Inc. with the early morning commentary for September 16, 2019.
Grain markets continue pushing higher on stronger export sales, short covering, and crop yield concerns as farmers begin to harvest. Traders will continue to focus on grain conditions, any frost indications and continuing progress in upcoming trade talks.
Last week, December corn futures were up 13.75 cents, November soybeans up 40.5 cents, December wheat up 19 cents, December soymeal was up $8.60 and December soyoil was up 76 points.
President Trump said the U.S. was “locked and loaded” for a potential response to an attack on Saudi Arabia’s oil facilities, after a senior official in his administration said Iran was to blame. Trump also authorized the use of the U.S. emergency oil stockpile to ensure stable supplies after the attack, which shut down 5% of world production.
USDA's weekly crop progress report will be released today at 3 p.m. CST. Trade is looking for corn condition rating at 54% GTE (55% GTE last week, 73% 5-year average). Soybean condition rating at 54% GTE (55% GTE last week, 69% 5-year average).
CFTC Commitments of Traders showed funds new net position short -136,399 corn contracts, short -91,737 soybean contracts, short -14,389 wheat contracts, short -6,232 live cattle contracts and long +19,426 lean hog contracts.
China exempts pork and soybeans from additional tariffs. Beijing told five privately-owned crushers that they would exempt punitive taxes of 30% that had occurred because of the trade war on up to 5 million metric tons of imports, according to AgriCensus.
August NOPA soybean crush report will be released today. Trade is expecting 162 mil bushels (168.1 mb last month). Soybean oil stocks are estimated at 1.410 billion lbs. (1.467 billion lbs. last month, 1.623 billion lbs. last year). If realized this will be the lowest since November 2017.
Brazil’s Marfrig Global Foods, a beefpacking firm, is in the process of hiring 400 new employees to work at its Promissao plant in the state of Sao Paulo to increase meat production for their growing Chinese demand. Marfrig has eleven units certified to export to China in South America. In addition to the Brazilian plants, there are four in Uruguay and two in Argentina, according to a press representative for Marfrig.
Japanese officials have culled 753 pigs in Saitama Prefecture north of Tokyo after detecting an outbreak of African swine fever, the Yomiuri newspaper said. Japan is the world’s 10th largest pork producer, and exports about $111 million dollars worth of pork products annually.
Dressed beef values were higher with choice up 0.91 and select up 0.00. The CME feeder index is 136.05. Pork cut-out values were down 2.26.