Good Morning from Allendale, Inc. with the early morning commentary for September 4, 2019.
Grain Markets were mixed overnight after corn hit new contract lows in yesterday's trade. Traders continue to monitor weather map updates looking for any sign of an early frost or freeze as the US crop remains behind its usual schedule.
Allendale’s Annual Acreage Survey Results will be released in a live webinar today at 10:00 a.m. Register for the webinar here. The results will also be emailed to all participants following the live webinar. Thank you to everyone who participated this year, we all at Allendale appreciate your help.
Weekly crop progress reported corn good to excellent at 58%, inline with analyst estimates. Soybeans were reported 55% GTE, 1% below the analyst guess. Spring wheat was reported 55% harvested, just below the 57% estimate, but a good increase from last week's 38%.
USDA released the latest Grain Crushings and Co-Products Production report. They suggested 451 million bushels of corn used during July. We estimate, based on the weekly EIA reports, that we produced 1.360 billion gallons from that. This computes to 3.02 gallons produced per bushel. That is 3.2% over last year’s efficiency rate. Allendale’s concern about these efficient plants remains. This efficiency rate has been from +2.2% to +4.5% since December.
USDA's Crush report covered the month of July. During this time 179.5 million bushels were processed. That was 0.4% over the previous month. This is of no big surprise as the previously released NOPA report showed a 0.2% gain. From Sep 2018 – Jul 2019 we have now processed 1.913 billion bushels. USDA’s whole-year goal is 2.065.
AgRural estimates that Brazil's soybean acreage will only grow by 1.1% year over year, well below the 5.2% year over year rate over the last 10 years. They estimate the country will plant 36.3 million hectares (about 90 million acres).
Brazil's wheat industry group, Abitrigo, believes that the country will introduce a 750,000 tonne tariff-free wheat import quota next year. US wheat growers are thought to stand to benefit.
China on Monday announced that it had filed a case at the World Trade Organization (WTO) against the United States following its implementation of the additional 15-percent tariffs imposed on 300 billion U.S. dollars worth of Chinese imports on Sept. 1. (Reuters)
End user interest in beef for extended procurement delivery has been generally close to last year levels in recent weeks. Yesterday's weekly update from USDA indicated 1,809 loads for +22 day delivery. That was 8% over last year. The past four weeks have averaged 5% under last year.
Trade is waiting for the year's peak in offered beef production that may come in the next two to four weeks. This is both a seasonal issue, as weights are still rising, and also from the +5.2% year/year placements noted in the February to April.
October Hog futures closed limit up yesterday on renewed optimism of Chinese buying after their government took measures to calm consumer fears of higher pork pricing due to African Swine Fever. Hogs will have expanded limits today.
Dressed beef values were lower with choice down 1.11 and select down .65. The CME feeder index is 139.09. Pork cut-out values were up 2.49.