Ag Market Commentary

Corn starts the last session of the week with gains of 2 to 7 cents per bushel. Expiring December is up the most in thin trading conditions. Futures climbed 5 3/4 to 6 cents on Thursday. December futures expire today. The 1.6 MMT (63 million bushels) sale of corn to Mexico was the main reason for the rally yesterday. That’s the 5th largest daily sale of corn on record and will go into next week’s Export Sales report. Hopes that the possible China deal will include corn or ethanol are also buoying prices. Export bookings for the week ending 12/05 were above what traders had anticipated with the USDA reporting 873,525 MT. Shipments through the same week were 531,371 MT, which was 7.4% above Thanksgiving week, but still 44.19% below the same week last year. Accumulated shipments hit 6.876 MMT through the first 14 weeks of the MY.

Nearby soybean futures are trading 9 to 10 cents higher this morning on hopes (not yet confirmed by the Chinese) of a trade deal. Futures were up by 3 1/4 to 4 1/2 cents after Thursday action. Soymeal futures lost 40 cents/ton, while soy oil futures were up 65 points. Weekly USDA Export Sales data showed soybean bookings for the week ending 12/05 at the top end of trader estimates, with 1.05 MMT of current year sales. Total sales (including next MY) were 1.175 MMT. That was a 71.9% increase over last week, and a 59.1% increase over the same week last year for total net sales. Weekly shipments through the same week were at 1.443 MMT, a 4% decrease from last week and a 32.4% increase yr/yr. China was the destination for 62.19% of those shipments. China has averaged a 38.89% share of weekly shipments since September 1 but have maintained a 50% + share of weekly shipments for the last 6 consecutive weeks. The USDA report showed a neutral 257,668 MT of total meal bookings. Soy soil export sales were on the high end of trade estimates at 30,227 MT in the week ending 12/5.

--- provided by Brugler Marketing & Management

So far Wheat futures are 2 to 6 cents higher. Kansas City HRW futures led the way for a Thursday rally as contracts were as much as were up by as much as 12 1/2 cents. Chicago SRW futures were up 8 1/2 to 10 1/4 cents. MPLS HRS wheat futures had plus 4 1/2 to 4 3/4 on the board at the close. Wheat export bookings for the week ending 12/05 were 25.7% above market anticipation, with the USDA reporting 502,674 MT of weekly wheat sales. Through the first half of the Marketing Year, wheat bookings averaged 472,004 MT/week, a 5.04% improvement on last year’s average through the first half. Shipments through the first half of the MY averaged 475,592 MT, compared to last year’s 391,412 MT first half average. Net weekly sales were led by HRS wheat, which had 219,303 MT of weekly bookings, Japan purchased 171,045 of wheat in their monthly tender, with the U.S. filling 50.22% of the total. China announced their minimum support price for the 2020 wheat crop, the same as 2019, but they added a cap to the amount of wheat the government would purchase. The first ever MSP purchase ceiling is 37 MMT, but is not considered to be binding.

--- provided by Brugler Marketing & Management

Live cattle futures were mixed, April futures were 45 cents higher, while Dec and Feb posted 15 to 17 cent losses. Feeder cattle futures gave back back some of yesterday’s triple digits gains, posting losses of as much as $0.22 in the front months. The 12/11 CME Feeder Cattle index was at $143.31 with a 31-cent drop. Beef export sales totaled 11,898 MT and was 41.8% lower than the 5-week average. Afternoon boxed beef prices are still weak. Choice boxes were a flat $3 lower this afternoon, while select boxes dropped by $1.16. Cash cattle negotiations show $118 bids in TX, with asks still in the $121-$122 range. Cash cattle sales were reported at 119 in TX and KS on Thursday afternoon, while the USDA indicated some 117 action. Dressed sales were listed at $188 -$194. The FCE will hold a Friday sale this week, with showlists totaling 977 head so far. The USDA estimates week to date FI cattle slaughter at 386,000 head through Thursday, that is 9,000 head above last week’s pace.

---provided by Brugler Marketing & Management

Lean hog futures finished Thursday’s session in the black, futures gained $0.50 to $1.00 with Dec futures gaining 32 one day ahead of expiration. The 12/10 CME Lean Hog Index was at $59.46, after a 99-cent leap. Weekly pork export sales totaled 44,728 MT. That was a 53.2% increase over last week’s USDA net sales, and 33.8% higher than total export bookings through the same week last year. USDA’s pork carcass cutout value was $1.53 lower this afternoon; picnic shoulder cuts were the only primals that were higher on the day. USDA’s national average base hog price for 12/12 was down by $0.11 at $47.94. USDA estimated FI WTD hog slaughter at 1.963 million head through Thursday, which is 19,000 head behind last week’s pace. They lowered Wednesday’s estimate by 6,000 head.

---provided by Brugler Marketing & Management

The cotton market starts off with gains of 21 to 27 points while it waits for some sort of Chinese confirmation that the trade deal is a go. Cotton futures closed in the black on Thursday, with old crop advancing triple digits. Weekly USDA export sales were up 70% wk/wk with combined net sales shown at 283,676 RB. Those sales were also above the 5-week average of 277k RB. The report showed accumulated exports of cotton grew 6% to 3.286 MRB on the MY, which is 15.67% above last year’s pace. The Seam online cotton trading reported another active day for 12/11 with 14,209 bales sold at an average gross price of 58.42 cents per bale. The Cotlook A Index regained yesterday’s 50 points and is back to 75.35 for 12/11. The updated AWP for cotton increased by 69 points to 56.66 cents per lb. The previous movement was a 23 point decrease.

---provided by Brugler Marketing & Management

Market Commentary provided by:

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