Ag Market Commentary

Corn futures are UNCH to 1 cent lower this morning. They were 6 to 7 cents higher on Thursday, following some friendly USDA numbers. NASS put 2018/19 US average corn yield at 180.7 bpa, which was down 0.6 bpa from September and below trade estimates. USDA projects that the current MY carryout will be 1.813 bbu, up 39 mbu from last month but still well (106 mbu) shy of previous trade expectations. World ending stocks were on par with projections coming in at 159.35 MMT. Analysts are expecting the USDA Export Sales report to show 1-1.5 MMT in 18/19 corn export sales. EIA showed 1.04 million barrels of ethanol per day was produced in the week of 10/5. That was up 25,000 bpd from the previous week, but stocks grew by 576,000 barrels to 24.021 million barrels. CONAB’s initial projections for Brazilian 2018/19 corn production run 89.734-91.084 MMT, with USDA currently at 94.5 MMT.

Soybean futures are trading mostly 5 cents per bushel higher at the moment. They gained 6 to 6 1/2 cents yesterday after USDA numbers weren’t as bearish as traders had anticipated. Nearby soy meal was up 80 cents/ton, with soy oil up 8 points. The Crop Production report indicated 2018 projected US soybean yield @ 53.1 bpa, up 0.3 from the month previous. Harvested acreage was trimmed by 514,000 acres to 88.348 million acres, which left production down 3 mbu from September at 4.69 bbu. Ending stocks were increased by 40 mbu to 885 mbu on the larger carryover from 17/18. USDA now sees 2018/19 world carryout at 110.04 MMT, 1.78 MMT larger than Sept. Brazilian soy production for 2018/19 is expected to run 117.05 to 119.428 MMT according to CONAB. USDA is currently at 120.5 MMT. US Soybean export sales in the week of 10/4 are estimated at 0.8-1.3 MMT. Soy meal sales are seen at 150,000-450,000 MT, with oil at 5,000-26,000 MT.

--provided by Brugler Marketing & Management (402) 289-2330

Wheat futures are currently 2 to 4 cents higher after seeing 1 to 4 cent losses in most contracts on Thursday. USDA increased 2018 production to 1.884 bbu, as seen in the Small Grains report. They left their export projection at 1.025 bbu, while ending stocks were 21 mbu higher than last month at 956 mbu and slightly under estimates. World ending stocks were trimmed to 260.18 MMT, down 1.11 MMT from last month. Australian production was trimmed by 1.5 to 18.5 MMT and Russia was down 1 to 70 MMT. Trade estimates for export sales in the week of 10/4 are running 300,000-600,000 MT ahead of this morning’s report.

Live cattle futures were steady to 77.5 cents higher in the front months on Thursday, with back months lower. Feeder cattle futures were up in the nearby contracts, with most deferred contracts in the red. The CME feeder cattle index was down a penny on October 10 at $158.37. Wholesale boxed beef values were higher on Thursday afternoon. Choice boxes were up 40 cents to $202.41, while Select boxes were 72 cents higher at $192.49. USDA estimated weekly FI cattle slaughter at 468,000 head through Thursday. That was down 10,000 head from last week and 3,000 from the same week in 2017. A few cash cattle sales were reported on Thursday, mostly around $111. US beef production for 2018 was trimmed by 150 million pounds to 26.944 billion pounds in the WASDE report. A 190 million lb reduction to 4th quarter production was offset a 40 million lb jump in the 3rd quarter. Production for 2019 was raised by 190 million lbs to 27.910 billion pounds.

Lean hog futures posted triple digit losses in most contracts Thursday, with nearby Oct up 20 cents. October needs to stick close to the cash index as it expires today. The CME Lean Hog Index was up a penny on October 9 @ $69.34. The USDA pork carcass cutout value was 59 cents lower on Thursday afternoon at $78.61. The national base hog carcass value was 73 cents lower at $61.92. Week to date FI hog slaughter was estimated at 1.862 million head through Thursday. That is up 1,000 head from last week and 17,000 head above the same week last year. USDA estimated pork production for 2018 was cut by 250 million pounds to 26.425 billion pounds, on large reductions to 3rd and 4th quarter production. Estimated pork production for 2019 was trimmed 65 million lbs to 27.81 billion pounds.

--Call Brugler Marketing & Management @ (402) 289-2330 with questions or news tips.

Cotton futures are 83 to 89 points higher this morning. They settled with most contracts steady to 20 points higher on Thursday. Cotton traders were able to by and large ignore the sliding stock market. NASS added 80,000 bales to the US production number on Thursday @ 19.76 million bales, with slightly lower acreage but yield up 6 lbs to 901 lb/ac. That hike was quickly assumed away as damage from Hurricane Michael won’t show up until next month. Ending stocks were up 300,000 bales to 5 million on a reduction to projected exports. World carryout for 18/19 was trimmed by 3 million bales to 77.45 million bales, mainly on historical revisions to India. The Cotton Ginnings report showed that 1.287 million bales had been ginned as of 10/1, 3% larger than the same time last year. Cotlook A index down 50 points from the previous day at 86.35 cents/lb on October 10. The USDA weekly AWP was updated to 67.73 cents/lb.

--provided by Brugler Marketing & Management (402) 289-2330

Market Commentary provided by:

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Phone: 402-697-3623
Fax: 402-289-2353

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