Market Watch with Austin Schroeder
February 14, 2025
Roses Are Red
We all know the saying, about roses being red and with the Valentines Day holiday on Friday there is no better time for the saying. I am no poet, but what about ‘Roses are red, violets are blue, is the grain bull dead, and what if oats knew?’ Of the few commodities that saw weakness this week, oats were the leader to the downside. As the old saying goes, oats knows where corn goes. Wheat did jump in late in the week and save the day. While I am not saying the bulls uptrend is over by any means, but what exactly do oats know?
Corn held onto the gains this week, as March was up another 8 ¾ cents from last Friday. USDA did release updated WASDE data on Tuesday but left the US balance sheet alone. South American production, however, was trimmed, with both Argentina and Brazil cut by 1 MMT to 50 MMT and 126 MMT respectively. CONAB raised their Brazil output number by 2.5 MMT to 122 MMT. WASDE world stocks were cut by 3.03 MMT to 293.34 MMT. EIA data indicated ethanol production backing off 30,000 barrels per day to 1.082 million bpd in the week of 2/7. Stocks of ethanol were back down on tighter supplies; 720,000 barrels lower to 25.692 million. Export Sales data showed 2024/25 corn bookings at 1.649 MMT for the week ending on February 6. That took export commitments to 46.42 MMT, which is 75% of the USDA export forecast and still ahead of the average sales pace of 72%. The weekly release of CFTC data showed managed money speculators in corn futures and options cutting back 31,828 contracts from their net long position as of February 4, taking their net long to 332,389 contracts.
Wheat posted another week of gains across the three exchanges this week. Chicago March was up 17 1/4 cents (2.96%) on the week. March Kansas City posted a 17 cent gain this week (+2.81%). MPLS March was 5 3/4 cents (0.92%) higher than last Friday. Some of the strength came late in the week on concerns of cold temps in parts of the US and Russian growing regions. Tuesday’s WASDE report showed 4 mbu reduction to the US balance sheet on the same increase to the food use category. Stocks were reported at 784 mbu. World Stocks were also tighter, down 1.26 MMT to 257.56 MMT. The weekly Export Sales report tallied 569,561 MT in US wheat export bookings during the week of February 6. That took export sale commitments to 19.338 MMT, which is now 84% of the USDA forecast for exports and still lagging the 92% average selling pace. Commitment of Traders data indicated spec funds cutting another 7,663 contracts from their net short position in CBT wheat futures and options as of February 11 to 82,809 contracts. In KC wheat, they were at a net short of 30,248 contracts, a reduction of another 5,733 contracts as of Tuesday.
Soybeans had another choppy week, giving back 13 ½ cents (-1.29%) from last week’s gains. Meal futures were down $5.50/ton this week, with bean oil back up 9 points since last Friday. USDA’s monthly update to the US and world balance sheets showed no changes to the domestic side. Brazil production was left at 169 MMT, with Argentina slashed by 3 MMT. That helped to tighten the world stocks total by 4.03 MMT to 124.34 MMT. CONAB trimmed their Brazilian production number by 0.3 to 166 MMT. This week’s Export Sales report tallied 2024/25 soybean bookings at just 185,502 MT in the week of 2/6. That took the accumulated shipped and unshipped sales to 43.26 MMT. That is still 87% of USDA’s expected export total for the marketing year, now in line with the 87% average pace. CFTC’s weekly Commitment of Traders report showed spec traders cutting their new net long in soybean futures and options by nearly half (28,554 contracts) to 28,475 contracts as of February 11.
Live cattle were under pressure again this week as the cash market continues to fall back, with February down $3.025 (-1.51%). Cash trade slipped back lower this last week, reported at $202-203 across most of the country. Feeders were back up $1.45 (0.55%) on the week in the March contract. The CME Feeder Cattle Index was back up 64 cents week/week to $276.23. Wholesale boxed beef prices fell lower again this week, as the Chc/Sel spread narrowed to $7.56/cwt. Choice boxes were down $7.17 (-2.2%) to $314.70, while Select was $5.76 lower (-1.8%) to $307.14. Weekly beef production was 489.2 million lbs this week, down another 4.2% from last week and 3.4% below the same week last year. Year to date production is down 47.1% so far, on 8.4% fewer animals killed. USDA did make a large revision to their US beef production outlook in Tuesday’s WASDE, hiking 2025 production by 775 million lbs, sticking most of it in the 3rd (+215 mil lbs ) and 4th (+545 mil lbs) quarters. USDA’s Export Sales report showed a total of 13,098 MT of beef sold in the week of 2/6, down 47.41% from last week. Export shipments totaled 14,901 MT in that week. CFTC data showed some longs exiting the live cattle futures and options market in the week ending on February 11, down 14,665 contracts to 134,709 contracts.
Hogs found some slight strength as the week came to a close, up 45 cents. The CME Lean Hog Index was up another $3.01 this week at $88.06 as of February 6. USDA’s Pork Carcass Cutout was up another $4.99 this week (5.1%). The belly was again the leader to the upside, up $12.88, with the rib the only primal reported lower. Pork production was steady with last week and 0.6% above the same week last year at 553.6 million lbs. Year to date pork production is down 5.6%, as slaughter is 6.1% lower. Pork export sales totaled 24,947 MT in the week of 2/6, back down by nearly half from last week. Export shipments totaled 31,045 MT. The weekly Commitment of Traders report indicated speculators in lean hog futures and options adding another 7,297 contracts to their net long position as of February 11 to a net long 102,626 contracts.
Cotton futures bounced back this week with March 148 points (2.26%). Cotton Ginnings data from Tuesday showed 406,750 RB ginned in the last half of January, taking the total to 13.962 million RB. The WASDE saw stocks increase by 100,000 bales to 4.9 million on a cut to domestic use. The weekly Export Sales report tallied cotton sales at 244,673 RB of cotton sold in the week of February 6. Shipments were the largest this MY at 260,905 RB. Commitments are now at 9.131 million RB, which is 89% of the new USDA forecast, compared to the normal sales pace of 90% of USDA’s export projection. The FSA Adjusted World Price for cotton was back up 81 points this week, to 53.99 cents/lb. Friday’s Commitment of Traders report from CFTC showed managed money spec traders trimming back 1,926 contracts from their previous record net short position as of 2/11 to 60,481 contacts.
Market Watch
Next week starts a day late due to the President’s day holiday on Monday. Tuesday will begin the week with a normal open for the trade, with the weekly Export Inspections report out that morning. Updated NOPA data for January crush will also be updated on Tuesday. The weekly EIA Petroleum Status Report will be pushed back to Thursday morning. On Friday, USDA will publish their weekly Export Sales in the morning, with the NASS Cattle on Feed report released later that afternoon. March grain options expire on Friday as well.
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 2025 Brugler Marketing & Management. All rights reserved.
