AgriCharts Market Commentary
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Corn futures are trading 2 to 3 cents lower this morning. US weekly export sales totaled 986,800 MT, with more than 83% of the total consisting of fresh old crop sales. China bought 380,400 MT of sorghum last week as well. Private exporters today reported to the USDA a sorghum sale of another 108,000 MT to unknown destinations this morning under the daily system. The average trade guess in Bloomberg’s survey for corn ending stocks in the March 10 WASDE report is 1.831 billion bushels, a touch higher than the February estimate. The report will be Tuesday morning.
Soybean futures are currently fractionally mixed after dropping 8-10 cents on Thursday. Net weekly export sales, at 501,200, were slight above the high end of the pre-report estimates of 300,000-500,000 MT. The US has already shipped 85% of the current full year forecast from USDA, and total commitments including unshipped sales are 98% of the forecast. The trade average guess for soybean ending stocks next Tuesday is 377 million bushels, tightening about 8 million bushels from the February USDA figure of 385 million on assumptions of another hike in projected exports. We’re beginning to see deliveries vs. the March soybean contract now that prices have dropped enough to make the original sellers whole. There were 98 lots put out overnight, bringing the 2 day total to 198.
Wheat futures are trading steady to a penny per bushel higher this morning after setting new life of contract lows in several contracts on Thursday. Weekly US export sales at 507,600 MT were not the shot in the arm the bulls needed. The US Dollar Index burst through the 96 level and was up 439 points. That is raising concerns about future sales slowdowns. There were 279 contracts delivered vs. KC wheat, with most going from ADM to Dreyfus. There were 66 contracts delivered vs. Chicago, with no strong stopper noted.
Live cattle futures were lower on Thursday. Feeder futures were higher, excluding nearby March. The latest CME feeder cattle index reported was $206.66 for Wednesday, up one penny. Cash cattle trade has not developed with enough sales to determine market trend this week. The Choice boxed beef cutout was up $0.62 at $249.20, and Select boxes were down 65 cents at $246.58. Week to date cattle slaughter at 432,000 head is up 15,000 from last week but lags year ago by 10,000.
Lean hog futures closed more than a dollar lower yesterday, giving back some of the previous day advance. The pork carcass cutout averaged $68.27, down $1.71in the face of solid losses in almost every primal cut. Cash hog base prices in Iowa/Minnesota and the Western Corn Belt were up a nickel at $64.94 and $6.92, respectively. Weekly USDA pork export sales showed signs of improvement, but because reported sales are a small portion of the total monthly movement the true situation is difficult to assess. The CME Lean Hog index for Mon/Tuesday was another $1.06 higher from the Fri/Monday average, coming in at 67.73. Estimated week to date hog slaughter is 1.7 million head, up 42,000 from last week and 73,000 larger than the same point in 2014.
Cotton futures are trading 2 to 20 points lower this morning after a down day on Thursday. USDA reported a net reduction of 62,500 RB for old-crop Upland cotton export sales commitments in the week ended February 26. Old-crop commitments now total 95% of the full year USDA forecast, but you don’t want to see leakage via cancelled or deferred business. Shipments for the week were the largest of the marketing year, and they need to be. The YTD total of 4.717 million RB is down 1.01 million RB from last year at this time.The rise to new multi-year highs in the US dollar index is a concern for future sales, although it does not affect prices for China. Cert stocks rose to 9,858 bales from 9,317 bales with 981 new certs, and 440 decerts and another 947 contracts awaiting review.