Market Watch with Austin Schroeder
November 1, 2024
Change or No Change
The 2024 election is finally (almost). As we finish up the last weekend of political ads on every TV commercial break, we have both Presidential candidates promising some sort of change. While I won’t get into the details, there’ bound to be somethings that will change over the next four years and some that don’t. As for the markets this week, despite the day to day movement, not much changed from last week. Just hogs, cattle and the bean products had any sizable move, with corn, beans, wheat, and cotton seeing slight losses.
Corn futures got a weaker start to things this week, but managed to see a late bounce, closing with just a ¾ cent loss for December. The USDA reported several daily private export sale announcements totaling 1.298 MMT to Mexican, Japanese and unknown buyers this week, with 65,532 MT for 2025/26 and the balance for the current MY. This week’s Crop Progress report showed 81% of the US corn crop harvested by October 27, ahead of the 64% average. EIA data showed ethanol production up another 1,000 barrels per day to 1.082 million bpd in the week that ended on October 25. Stocks of ethanol were back down 452,000 barrels to 21.771 million barrels. Monthly Grains Crushing data showed 440.2 mbu of corn used for ethanol production in September, a 2.74% increase over last year but down 8.2% from August. Weekly Export Sales data indicated another strong 2024/25 crop sales total of 2.341 MMT in the week ending on October 24. That took export commitments to 25.82 MMT, a 41% increase over last year. That is also 44% of the US export forecast and now ahead of the average sales pace of 40%. Commitment of Traders data showed managed money slashing 53,796 contracts from their net short in corn futures and options. As of October 29, they were net short just 17,703 contracts.
Wheat was again weaker this week, led by the hard wheats. Chicago December was just a penny lower (-0.18%) for the week. December Kansas City saw a loss of 5 1/4 cents (-0.92%) this week. MPLS Dec was down 5 1/2 cents since last Friday (-0.91%). Crop Progress data tallied the winter wheat crop at 80% planted by last Sunday, with emergence 56% complete, behind the average pace. Initial condition ratings were tallied at 38% in good/excellent condition, as the Brugler500 score was the second lowest for the first fall rating since 1987 at 313. Export Sales data showed US export business dropping off in the week that ended on 10/24 to 411,424 MT. That took export sale commitments to 13.202 MMT, which is 61% of the USDA forecast for exports, still lagging the 64% average selling pace. CFTC’s weekly report showed CBT wheat spec traders increasing their net short position by 2,257 contracts to a net short of 31,172 contracts as of 10/29. In KC wheat, they added back 3,513 contracts to their net short position at 9,160 contracts as of Tuesday.
Soybeans clawed back some early week losses, but still managed to see a weekly loss of 3 ¾ cents for the January contract. Soybean meal continues to be the thorn in the side of the bulls, with a drop of $10.50/ton (3.43%). Bean oil was a supportive factor after the Monday collapse, rallying 215 points on the week (4.87%). USDA reported daily announcements of just over a combined 594,000 MT of soybeans to China and unknown destinations this week. Monthly crush data from the USDA showed 186.5 mbu of soybeans crushed during September, up 11.31% from August and a 6.72% increase from last year. Monday’s Crop Progress report showed 89% of the US soybean harvest was complete by October 27, well ahead of the 78% average pace. Export Sales data showed 2024/25 business improving to a MY high of 2.273 MMT. That took the accumulated shipped and unshipped sales to 26.266 MMT. That is 52% of USDA’s expected export total in their WASDE balance sheet, now 6 percentage points back of the average pace. CFTC Commitment of Traders data showed soybean spec traders adding another 12,652 contracts to their net short position as of Tuesday, to 72,226 contracts.
Live cattle pulled back this week, with December back down $3.225 (-1.70%). Cash trade was mostly $189-190 this week, a drop from the week prior. Feeders saw some later week strength on Friday to limit the loss to just $1.70 (-0.68%) this week in the November contract. The CME Feeder Cattle Index was back up $1.89 week/week to $250.98. Wholesale boxed beef prices backed off this week, as Choice was down $5.90 (1.8%) to $36.34, while Select was $10.05 lower to $285.03. Weekly beef production was down 1% from the previous week but 0.5% above the same week last year at 532.1 million lbs. That left the YTD beef production down 0.6% from the same time a year ago, with cattle slaughter down 3.8%. Export sales of beef totaled 13,854 MT in the week of 10/24, a drop from the week prior. Sales of 5,700 MT were also reported for 2025. Shipments totaled 15,737 MT in that week, a reduction from the previous week. Commitment of Traders data tallied cattle managed money adding 8,178 contracts to their net long at 98,569 contracts as of 10/29. Specs in feeder cattle trimmed their net long by 555 contracts to 8,960 contracts as of Tuesday.
Hogs continued to extend their strength in the December contract this week, up another $4.40 (5.52%). The CME Lean Hog Index was back up $2.73 this week at $87.93 as of October 30. USDA reporting a case of H5N1 avian flu in a back yard swine herd in Oregon this week seemed to have little affect on the market. USDA’s Pork Carcass Cutout was up $5.03 this week to $103.97. The belly, ham, and rib primals again were the main drivers, up in a range of $8.16 to $18.57. Weekly pork production was up 2.4% from the previous week but down 0.6% above the same week last year at 565.9 million lbs. That left the YTD pork production down 1% from the same time a year ago, with hog slaughter down 1.5%. Pork export sales totaled 44,838 MT in the week of October 24, a 3-week high. Export shipments totaled 32,268 MT, slightly above last week’s total. Managed money in lean hog futures and options added another 15,779 contracts to their now record net long position as of October 29 to a net long 102,905 contracts.
Cotton futures slipped back this week, with December down 33 points (-0.46%). The weekly Crop Progress report showed 97% of the US cotton crop with bolls open by 10/27 and 52% of the crop harvested, 6% ahead of the average pace. Condition ratings were 4% lower to 37% gd/ex in the final tally for the year, with the Brugler500 index back down 9 points to 286. Export Sales data showed an improvement in bookings during the week of October 24 to 189,436 RB, which was the second highest total reported for the marketing year. Export shipments improved to 134,348 RB in that week. Total commitments for upland cotton are 5.663 million RB, which is 53% of the USDA forecast. Normally sales would be 64% of USDA’s export projection by now. The FSA cut back the Adjusted World Price for cotton by 75 points on Thursday, to 58.54 cents/lb. Weekly data from CFTC showed managed money spec funds in cotton futures and options adding back 4,455 contracts to their net short as of October 29. By that Tuesday they were net short 10,649 contracts.
Market Watch
Next week begins with the weekly Export Inspections report on Monday morning and the Crop Progress report out in the afternoon. Monthly Census Trade data will be updated on Tuesday, which also happens to be election day. On Wednesday, the EIA will release their Weekly Petroleum Status Report. USDA will release the weekly Export Sales report on Thursday morning, with the Fed interest rate decision also out that afternoon. Friday will see USDA’s monthly WASDE, Crop Production, and Cotton Ginnings reports, with the last trade day for December cotton options.
Visit our Brugler web site at https://www.bruglermarketing.com or call 402-697-3623 for more information on our consulting and advisory services for farm family enterprises and agribusinesses.
There is a risk of loss in futures and options trading. Similar risks exist for cash commodity producers. Past performance is not necessarily indicative of future results.
Copyright 2024 Brugler Marketing & Management. All rights reserved.
