Tag Archives: markets

Summary

At the settlement the risk off feeling that started at the open stayed with most grains. Soybeans were the lone grain in the green as buyers were found midday in the soymeal. The bulls then spilled over to the soybeans. John Payne, Daniels Ag Marketing, points to strong packer margins needing to continue feeding livestock as the reason why soybeans were able to find some support. Corn and wheat closed lower with wheat seeming to be the leader to the down side.

Yesterday Argentina’s Ag Ministry halted the registration of ag exports. Analysts believe this signals a big rise in export taxes is about to hit the country.  The US Dollar is also sinking with the equities and have backed the Dollar down from it’s April 2017 highs.

Not helping the grain bulls was wheat and soybean export sales missed analysts expectations. Wheat came in at 381,000 MT and soybeans 339,000 MT. Soybeans missed the most frugal analysts by about 200,000 MT and China was only 71,000 MT of the sales. Corn export sales were in line at 864,000 MT. Sorghum also hit a marketing year high at 444,500 MT with 324,200 MT bought by an unknown destination.

USDA announced just prior to the open on Wednesday that South Korea is in for 12,300 MT of option origin corn.

Ukraine’s grains exports are up 23.1% for the current marketing year.

According to EIA data, ethanol production expanded by 1.3%, or 15,000 barrels per day (b/d), to 1.054 million b/d last week.
Ethanol stocks tightened 0.3% to 24.7 million barrels.
Imports of ethanol arriving into the West Coast were 35,000 b/d, or 10.29 million gallons for last week. This is the first time in six weeks that imports were logged.

Livestock futures traded in fairly big ranges with almost all contracts trying the limit lower move at some point. No contracts closed limit lower so normal trading ranges will be in place for tomorrow. The pork cut out at midday saw a nice bounce back to the bellies. For beef the select is now struggling to get back above $200. Choice also still seems to stall above $207.

Beef net export sales were at 13,900 MT dn 28% from last week and the 4 week wtd avg. Top buyers included Japan, South Korea, Mexico, and Canada. Beef exports were at 17,800 MT down 1% from the last week and up 2% from the 4 week average. Japan, South Korea, Mexico, Taiwan and Canada were the top destinations.

Pork net export sales were 38,900 MT up 64% from last week and 34% above the 4 week weighted average. Top buyers included Mexico, South Korea and China. Pork exports were at 42,500 MT up 1% from last week and the 4 week weighted average. Top destinations were again China, Mexico, Japan, South Korea and Canada.

The country is very quiet this afternoon and it is looking like business is essentially be done for the week Some sources are saying that other than some cleanup, business just may be essentially done for the week, especially in the South. Having said that, asking prices for cattle left on show lists are around $117 plus in the South, and $187 plus in the North. Tuesday saw light to moderate trade in most areas. Northern dressed trade ranged from $185 to $187, mostly $187, roughly $3 lower than last week’s weighted average basis Nebraska. Southern live deals were at $115, generally $5 lower than the prior week’s weighted averages.

Midday Carcass Value Thursday

Beef

Choice dn 0.50 205.84

Select up 1.24 199.84

C/S Spread 6.00

Loads 101

Pork

Carcass up 1.94 66.43

Bellies up 12.97 80.28

Loads 194

Daily Slaughter Thursday

Cattle

121,000 hd today 122,000 hd wk ago 118,644 hd yr ago

Hogs

495,000 hd today 495,000 hd wk ago 475,261 hd yr ago

Grains Settlements

  • Corn  dn 2 1/4 -6 1/2
  • Soybeans dn 1 1/2 – up 5 1/4
  • Chicago Wht dn 5 1/4 – 11
  • Kansas City Wht dn 6 1/2 – 9

Livestock Settlements

  • Live Cattle dn 1.87 – up 0.32
  • Feeder Cattle dn 1.90 up 0.87
  • Lean Hogs dn 0.77 -2.60
  • Class III Milk dn 0.02 -0.26

 Pre-opening Market Broker  Commentary

Jeff French, Top Third Ag Marketing, discusses overnight grains and what the trade may see today.


Jerry Stowell, Country Futures,  looks at what may impact the livestock futures today.

Mike Zuzolo, Global Commodity Analytics, takes a look at the midday trade. Zuzolo see’s the current market trade as a possible buyers market.


John Payne, Daniels Ag Marketing, looks at the grain settlements.


Jack Fenske, York Commodities, looks at the closing market numbers.

Kansas Corn is partnering with Renew Kansas to host the Kansas Corn-Fed Ethanol Seminar. Happening on March 4 at American Ag Credit, 4105 N. Ridge Rd., Wichita, this seminar will provide attendees with updates and learning opportunities covering a broad view of the ethanol industry.

 

“With nearly one-third of Kansas corn going directly into ethanol production,” said Kansas Corn Director of Industry Relations Stacy Mayo-Martinez. “It is important for those in the corn and agriculture industry to understand the market, the opportunities and the hurdles to better grasp how it affects Kansas corn prices. This is a unique learning opportunity and we are proud to partner with Renew Kansas.”

 

The seminar will explore ethanol export opportunities; barriers to increased ethanol use and connecting consumers with ethanol blends. A fuel retailer panel and an expert panel on economic impact and plant innovation will round out the seminar.

 

Kansas is a significant ethanol producing state producing about 500 million gallons of ethanol per year and represents a significant market for corn producers. About one-third of Kansas corn is used to make ethanol and DDGS feed, the co-product of ethanol production.

 

Those interested in the event can find more information and register online at https://kscorn.com/cornfedethanol/.

 

Kansas Corn represents corn farmers in Kansas, while Renew Kansas represents the state’s ethanol industry. For more information, visit kscorn.com and renewkansas.com

 

The Livestock Marketing Information Center released Analysis and Comments on the American sheep flock this week and said two “unusual developments could factor into the lamb market calculus during the next 12 to 24 months.”

 

“First, the growth rate of American lamb and mutton imports might moderate significantly as the Australian flock has downsized due to drought, and China imports more-and-more of all animal-based proteins driven by the African Swine Fever epidemic inducing reductions in their pork production,” read the report. “However, in the near-term, the China story has a new dimension of uncertainty with the Novel coronavirus epicenter in Wuhan, China. Second, 2020 brings on line both opportunities and potential disruptions to the sector – the opening of a modern, federally inspected lamb packing plant in Colorado (Colorado Lamb Processors near the town of Brush). That state-of-the-art plant is scheduled to begin harvesting animals late in the first quarter of the year, or early in the second.”

 

“In the face of the developments listed above, for the next two years, annual changes in the supply of American lambs are expected to be rather modest. Importantly, the two unusual developments described above, provide uncertainty regarding how much U.S. prices increase and how volatile markets are.”

 

However, the report concludes with some promising news.

 

“Overall, for the first three quarters of 2020, look for lamb prices (slaughter and feeder) to be at or above 2019. For slaughter lambs, the largest percentage year-over-year gain is expected to be in the first quarter. The second quarter might bring the biggest gain from 2019 for feeder lambs. Note that the first quarter of 2019 had very low slaughter lamb prices compared to the balance of that year. Even though lamb supplies should remain tight during the fourth quarter, the LMIC price forecast incorporates some pressure from competing meats, especially huge pork supplies. Still, lamb prices that quarter might be very close to 2019.”

 

USDA on Tuesday boosted exports for soybeans 50 million bushels (mb) but lowered corn exports 50 mb, despite high sales expectations because of recent trade deals.

USDA increased its forecast for soybean exports by 50 mb to 1.825 billion bushels (bb). Ending stocks, at 425 mb, declined from last month by a corresponding amount and fell within the range of pre-report expectations.

Corn exports were projected at 1.725 bb, down 50 mb from January.

USDA did bump up wheat exports up 25 mb from the January report, to 1 bb

USDA released its February World Agricultural Supply and Demand Estimates on Tuesday as well as its monthly Crop Production report. Traders were closely watching just how USDA might integrate projected exports to China for a few key commodities following the announcement last month of the phase-one trade deal with China that is meant, in part, to boost U.S. agricultural sales to China.

According to DTN Lead Analyst Todd Hultman, Tuesday’s U.S. ending stocks estimates were neutral for corn and slightly bullish for soybeans and wheat; world ending stocks estimates were neutral for corn and wheat, but somewhat bearish for soybeans.

You can access the full reports here:

— Crop Production: https://www.nass.usda.gov/…

— World Agricultural Supply and Demand Estimates (WASDE): http://www.usda.gov/…

CORN

The monthly corn production estimate for the 2019-20 crop was projected at 13.69 bb, the same as January, with a national average yield of 168 bushels per acre, also unchanged.

Exports were lowered 50 mb to 1.725 bb with USDA citing “the slow pace of shipments through January.” USDA increased domestic ethanol use by 50 mb as well, increasing use to 5.425 bb for ethanol for the 2019-20 crop.

Total corn use was projected at 14.07 bb, the same as January, and ending stocks were projected at 1.892 bb, also the same as January. That brings the stocks-to-use ration for the 2019-20 crop at 13.4%.

The average farm-gate price for the 2019-20 crop was pegged at $3.85 a bushel, also unchanged for January.

Globally, USDA slightly lowered global production by a fractional number, but increased global domestic demand by 1.81 million metric tons (mmt). Global ending stocks, less China, were dropped by 970,000 metric tons.

The corn stocks-to-use ratio for the 2019-20 crop year was 13.4%, unchanged from last month.

SOYBEANS

USDA forecast 2019-20 domestic ending stocks at 425 mb, a 50 mb decline from last month based on forecasts for corresponding increase in exports. The agency left production and other demand forecasts unchanged.

The national average farm gate price was lowered by a quarter to $8.75 per bushel.

Globally, USDA revised ending stocks upwards to 98.86 mmt a 2.19 mmt increase. Brazilian production forecasts climbed by 2 mmt to 125 mmt while Argentine production was left unchanged at 53 mmt.

Domestic soybean stocks-to-use for 2019-20 declined to 10.5% from last month’s 11.8% estimate.

WHEAT

Domestic 2019-20 wheat ending stocks were trimmed by 25 mb to 940 mb, a five-year low that came within analysts’ pre-report expectations. That change was driven entirely by an increase of 25 mb in wheat exports, from 975 mb in January to 1 bb in the February report. The agency cited “growing competitiveness in international markets” for that adjustment.

The average farmgate price for wheat was pegged at $4.55 per bushel, unchanged from the January report.

USDA tweaked global ending stocks to 288.03 mmt, just under last month’s estimate of 288.08 mmt and within analysts’ pre-report estimates.

Australian wheat production was left unchanged from the January estimate of 15.6 mmt, despite widespread fires and drought in the country. USDA also left Russian wheat exports at 34 mmt, despite reports that the Russian government would soon restrict exports.

Wheat stocks-to-use declined by 1.7 percentage points to 43.4%.

WORLD PRODUCTION (million metric tons) 2019-20
Feb Avg High Low Jan
CORN
Argentina 50.0 49.8 51.0 48.0 50.0
Brazil 101.0 100.8 101.0 99.0 101.0
SOYBEANS
Argentina 53.0 53.1 54.0 52.5 53.0
Brazil 125.0 123.8 125.0 122.5 123.0
U.S. ENDING STOCKS (Million Bushels) 2019-20
Feb Avg High Low Jan 2018-19
Corn 1,892 1,856 2,017 1,667 1,892 2,221
Soybeans 424 448 586 320 475 909
Wheat 940 953 999 900 965 1,080
WORLD ENDING STOCKS (million metric tons) 2019-20
Feb Avg High Low Jan 2018-19
Corn 296.8 297.5 299.5 295.0 297.8 320.4
Soybeans 98.9 97.2 102.9 94.2 96.7 110.3
Wheat 288.0 287.2 288.8 280.0 288.1 278.1

Heather Ramsey, ARC Group, talks China, Corona Virus, flow, and Brazilian soybeans. The Corona Virus kept the entire market space in a fear grip for most of the trading day. China is considering extending is Lunar New Year celebration in an effort to curb the spread of the virus.  Export inspections were not exciting and mostly expected. Except for wheat which came in below analysts expectations. Brazilian soybean harvest is about 9% behind where it was a year ago.

There are plenty of factors currently impacting the market trade Ramsey shows how timing over historical periods are still very important to a farm marketing strategy.

Ramsey says, “As farmers were worried about protecting from lower prices. We can always handle higher prices by selling more.”

MANHATTAN, Kan. — Six college students selected for the third class of the Kansas Corn Collegiate Academy kicked-off the first of four learning sessions recently. This session, held in Kansas City was focused on trade, consumer education and agronomy.

The Collegiate Academy program is part of an overall effort by the Kansas Corn Growers Association (KCGA) and Kansas Corn Commission to provide opportunities for college students of all majors to learn more about the corn industry, explore issues facing agriculture and discover how they can impact the industry through their future career paths.

“The Collegiate Academy had the opportunity this weekend to explore various aspects of the corn industry from field to end-user,” says Kansas Corn’s Market Development Coordinator, Emily Koop. “During their session they learned the basics of agriculture policy and corn production in the state of Kansas. In addition, they discovered more about the importance of international trade, the logistics and infrastructure utilized for the movement of agriculture commodities and were exposed to a variety of career opportunities available to them in the agriculture industry.”

Students met with leaders from the U.S. Grains Council, BNSF Railway, John Deere, Compass Minerals, and Guetterman Brothers Family Farms. Students also trained on how to tell their story and educate consumers with help from Roots & Legacies Consulting and Bichelmeyer Meats.

Kansas Corn Board Member and Commissioner, Ken McCauley, had a chance to speak with the Collegiate Academy about his operation and the role associations play in policy.

“I enjoyed the opportunity to explain to students the efforts KCGA is taking a variety of policy issues and raise awareness about the issues Kansas corn growers face,” says McCauley. “It’s exciting to see young people in the Collegiate Academy who are eager to learn about corn issues.”

The academy will spend their next session at the capitol in Topeka where they will learn more about the role government plays in the agriculture industry. The third session will be in conducted in western Kansas where participants will learn about livestock, ethanol and water issues. The Collegiate Academy will have their final session in Washington D.C., during the National Corn Growers Association’s Corn Congress.

Kansas college students enrolled in 2-year or 4-year post-secondary schools are eligible to apply. For more information on the collegiate academy and other collegiate programs visit kscorn.com/corn-on-campus.

Full listing of Collegiate Academy Class 3
Shelby Hattrup, Kinsley; agronomy
Austin Hobbs, Fredonia; agronomy
Ellie Katzer, Louisburg; agribusiness
Reile Meile, Ulysses; agribusiness
Zoe Schultz, Grainfield; agriculture communications and journalism and agronomy
Kourtney Weingartner, Topeka; agriculture economics