AgriCharts Market Commentary

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Corn Market Fractionally Lower Overnight

Corn was fractionally lower during the overnight trades. Corn futures reacted to the reports as expected, which is to say not at all. The WASDE report left projected US ending stocks unchanged at 1.91 bbu. Likewise, Argentine corn production was steady with November at 50 MMT. Corn production from CONAB was up 50,000 MT mo/mo, at 98.41 MMT, but they are still below USDA’s 101 MMT for Brazil. World corn production was estimated at 1.108 billion MT. That is up 10.7% from the average since 09/10 but down 1.41% from last year. World corn consumption was 0.08% lower yr/yr at 300 MMT. The world corn stocks to use ratio is 26.42%; the average from 09/10 was 23.767% with help from the 2012 drought. The current S/U ratio for last year (still being revised) is 27.8%. Thus, the situation is still seen tightening. There were 79 deliveries against Dec corn overnight, with the ADM house account a stopper for 57 of them.

---provided by Brugler Marketing & Management

Soybean Market News and Commentary

Front month bean futures start off the Wednesday session with 1/2 to 2 cent losses. They closed 2 1/4 to 3 cents higher on Tuesday. Soybean meal futures gained 10 cents per ton, while soybean oil futures were up 18 points. Bunge dumped 500 contracts into delivery against December meal overnight, with various non-commercial stoppers. WASDE left US 2019/20 soybean carryout at 475 mbu. USDA did reduce the expected cash average price for this year to $8.85 from $9.00. As for the world bean numbers, Brazil production was also firm, forecasted again at a record 123 MMT. Soybean production from CONAB was up ~200,000 from the previous forecast, now 121.1 MMT. The USDA estimates 2019/20 world bean ending stocks at 96.4 MMT, which is up from last month following a hike in projected Chinese soybean production to 18.1 MMT. China indicated an 11% uptick in area planted vs. 2018. USDA boosted expected Chinese ending stocks by the same 1 MMT. World soybean ending stocks were the lowest since 17/18, pre trade war.

--- provided by Brugler Marketing & Management

Wheat Markets 2 to 3 Cents Lower

Wheat futures are trading 2 to 3 cents lower this morning in all three markets. Yesterday the wheat market was up 1 to 5 cents, with KC HRW the firmest. The WASDE Report showed a decrease of 40 mbu to U.S. wheat carryover. The adjustment came from a 15 mbu decrease in imports and a 25 mbu increase to wheat exports from the previous estimate. Ending stocks were lower than trader expectations at 974 mbu, which would be a 4-year low for ending stocks. The U.S. Stocks to Use ratio tightened to 45.7%. The 5 previous years’ average stocks to use ratio is 49.8%. World ending stocks were 1 MMT higher than the November forecast; at 289.5 MMT. The USDA revised Aussie wheat forecast to 16.1 MMT a 1.1 MMT reduction from the Nov estimate and 1.2 MMT lower than last year. GASC (Egypt) purchased 355,000 MT of wheat in an international tender for early February delivery, 60k MT Ukrainian 60k MT Romanian 120k MT French 115k MT Russian. Japan is looking for 171,045 MT of wheat – with half from U.S and the remainder sourced from Canada and Australia.

--- provided by Brugler Marketing & Management

Cattle Market Churning Around $120

Live cattle futures finished Tuesday with 12 to 30 cent losses. Feeder cattle futures were 50 to 57 cents higher in the front months. The 12/09 CME Feeder Cattle index was $143.35 after a 2 cent bump. Afternoon boxed beef prices are lower, tightening the Choice/Select spread to $16.14. It will typically narrow to single digits by February. Choice boxes were $2.15 lower this morning at $221. 94. Select boxes dropped by $1.14 to $205.35. The online Fed Cattle Exchange will offer 1068 head today, with 600 head from Nebraska, 253 head from KS and TX offering 215 head. The USDA reported light cash sales activity in KS, hovering in the $118- $119 range. The USDA estimated Tuesday cattle slaughter under federal inspection to be 122,000 head; which put the week to date estimated slaughter at 243,000.

---provided by Brugler Marketing & Management

Lean Hogs Higher in Choppy Trading

Lean hog futures closed with gains of $1.12 to $1.25. The last trading day is Friday for December hogs, which were 50 cents higher on Tuesday. The 12/06 CME Lean Hog Index was $58.12, after a 35-cent fall. USDA’s pork carcass cutout value was higher, having gained $1.14 for the day. USDA’s national average base hog price for 12/10 was another 62 cents higher to $47.68. Tuesday added 494,000 head to the USDA estimated hog slaughter, pushing the weekly total to 985,000 head, following a 5,000 head reduction from Monday’s estimate.

---provided by Brugler Marketing & Management

Cotton Market 33 to 39 Lower Overnight

Overnight cotton prices moved 33 to 39 points lower. Cotton futures posted gains ranging from 0 to 56 points in the nearby contracts on Tuesday. The US dollar index is higher this morning. US average cotton yield was lowered by 3% to 761 lbs/acre by USDA. The new lower yield pushed production for the 19/20 crop to 19.48 million bales. The cotton crop is still 1.914 million bales above the 2018 production. Ending stocks were trimmed to 5.5 million bales but the stocks/use ratio of 28.2% is still the worst since 2015/16. The USDA Cotton Ginnings report showed cumulative ginnings have reached 12.930 MRB. That is a 9-year high for the December report. The number grew 3.617 MRB through the latter half of Nov. The Seam reported online cotton sales of 5,327 bales for Monday, last Monday there were 7,655 bales. The Cotlook A Index was back above the 75 mark after a triple digit move on 12/09; the index was up 1.45 to 75.35. The weekly AWP is 55.97 cents/lb through Thursday.

---provided by Brugler Marketing & Management


Market Commentary provided by:

Brugler Marketing & Management LLC
1908 N. 203rd St.Omaha, NE 68022
Phone: 402-697-3623
Fax: 402-289-2353
E-mail: alanb@bruglermktg.com
Web: http://bruglermarketing.com