Ag Market Commentary
Brugler Marketing and Management, LLC - BRUG - Fri Aug 10, 3:59PM CDT

Corn futures ended Friday session with most contracts down 10 to 11 1/2 cents, following the USDA reports this morning. Nearby Sep was down 3.25% on the week. The monthly Crop Production report from NASS showed the national average US corn yield at 178.4 bpa, 2.2 bpa above the average trade estimate. That put the production total for the US at 14.586 bbu, up 356 mbu from July. The jump in production caused the new crop ending stocks projection to be raised to 1.684 bbu. Old crop US stocks were UNCH at 2.027 bbu. Brazil production was cut by 0.5 to 83 MMT, with exports down 3 to 23 MMT. That helped old crop world stocks to jump to 193.33 MMT. New crop world carryout was up 3.53 MMT from USDA’s previous number to 155.49 MMT, thanks in part to the US production hike. Friday’s CFTC report showed spec funds shrinking their net short by another 22,493 contracts in the week ending August 7. That took the net short position to 29,705 contracts.

Sep 18 Corn closed at $3.57 3/4, down 11 1/2 cents,

Dec 18 Corn closed at $3.71 3/4, down 11 cents,

Mar 19 Corn closed at $3.83 1/4, down 10 3/4 cents

May 19 Corn closed at $3.90 1/4, down 10 1/2 cents

Soybean futures posted sharp 40 to 42 1/4 cents on Friday. August lost 4.54% on the week. The USDA numbers were not bull friendly. Nearby soy meal was down $10.50, with soy oil 43 points lower. The USDA reported a private export sale of 210,000 MT of soybeans to unknown destinations, split between 17/18 (80,000 MT) and 18/19 (130,000 MT) delivery. That was ignored. NASS indicated a national average soybean yield at 51.6 bpa based on producer surveys in this morning’s Crop Production report. That exceeded expectations, with production seen at a record 4.586 bbu, 276 mbu higher than the July number. New crop US ending stocks were seen at a huge 785 mbu, up 205 mbu, with old crop carryout 35 mbu lower at 430 mbu. World old crop ending stocks were tightened to 95.61 MMT. New crop carryout was updated to 105.94 MMT for the world number, a bearish 7.67 MMT increase assisted by the US crop number. CFTC managed money net position showed the funds net short -56,283 contracts of futures and options on 8/7, which was just 2,388 contracts less bearish than the week prior.

Aug 18 Soybeans closed at $8.46, down 41 3/4 cents,

Sep 18 Soybeans closed at $8.50 3/4, down 42 1/4 cents,

Nov 18 Soybeans closed at $8.61 3/4, down 42 1/4 cents,

Mar 19 Soybeans closed at $8.85, down 40 cents,

Aug 18 Soybean Meal closed at $323.50, down $10.50,

Aug 18 Soybean Oil closed at $27.99, down $0.43

Wheat futures closed between 17 and 21 cents lower this afternoon. This morning’s NASS Crop Production report tallied all wheat production for 2018 at 1.877 bbu, just 4 mbu smaller than the previous report. HRW was seen at 661.22 mbu, with SRW at 291.8 mbu. Production of the spring wheat crop was just slightly higher to 614.155 mbu, as yield was UNCH from July at 47.6 bpa. They disagree with the Wheat Tour. US ending stocks of 18/19 wheat were shown at 935 mbu on a 50 mbu addition to the export projection. Production of the Russian wheat crop was up 1 to 68 MMT, with private estimates from SovEcon at 68.4 MMT and IKAR at 70.1 MMT. The New Crop world ending stocks projection was cut by 1.92 to 258.96 MMT. EU production was cut 7.5 MMT (275 million bushels!). The Commitment of Traders report shows money managers adding 11,655 contracts to their net long position in CBT futures for the week ending August 7. They also added 15,150 contracts to their net KC long position at 55,086 contracts on that date.

Sep 18 CBOT Wheat closed at $5.46 3/4, down 17 3/4 cents,

Sep 18 KCBT Wheat closed at $5.59 3/4, down 18 3/4 cents,

Sep 18 MGEX Wheat closed at $6.08 3/4, down 21 cents

Live cattle futures were mixed on Friday, with front months steady to 20 cents higher and back months lower. Feeder cattle futures were steady to 5 cents in the green. The CME feeder cattle index was 67 cents higher from the previous day on 8/9, reaching $151.12. Wholesale boxed beef values were mixed on Friday afternoon. Choice boxes were up 55 cents at $206.61, while Select boxes were down 32 cents at $197.77. Weekly FI cattle slaughter was estimated at 645,000 head through Saturday. That is up 19,000 head from the previous week and 9,000 head above the same week in 2017. A few cash cattle sales of $110-111.50 live and $178-179 were reported in the North on Thursday. USDA’s projection for 2018 beef production was trimmed by 56 million pounds to 27.094 billion, with 2019 increased 30 million from July to 27.720 billion pounds.

Aug 18 Cattle closed at $108.250, unch,

Oct 18 Cattle closed at $109.250, up $0.200,

Dec 18 Cattle closed at $113.100, up $0.125,

Aug 18 Feeder Cattle closed at $149.900, up $0.550

Sep 18 Feeder Cattle closed at $149.525, up $0.500

Oct 18 Feeder Cattle closed at $149.475, up $0.275

Lean hog futures settled the Friday session mixed, with nearby Aug down 17.5 cents and December up 15 cents. The CME Lean Hog Index was down $1.29 on August 8, to $61.88. The USDA pork carcass cutout value was down 38 cents from the previous day at $71.07 on Friday afternoon. The ham and picnic primal cuts were both reported higher. The national base hog carcass value was down $1.76 in the Friday PM report, with the weighted average @ $45.93. USDA estimated weekly hog slaughter at 2.333 million head through Saturday. That is up 13,000 head from last week due to huge Saturday slaughter and 49,000 head above the same week last year. The USDA supply and demand table for pork shows estimated pork production in 2018 at 26.71 billion pounds, down 35 million. The 2019 number was increased 175 million to 27.875 billion pounds.

Aug 18 Hogs closed at $54.800, down $0.175,

Oct 18 Hogs closed at $51.175, down $0.225

Dec 18 Hogs closed at $47.475, up $0.150

Cotton futures ended the Friday session with losses of 140 and 203 points. The US dollar index did not help matters much, up 780 points on the day This morning’s Crop Production report showed a national average all cotton yield of 911 lb/ac, with upland at 895. That was up 66 pounds from the July report, as production rose 740,000 bales to 19.24 million bales. The US ending stocks number was up 600,000 bales to 4.6 million with old crop exports trimmed 350,000 bales to 15.85 million bales. World ending stocks were cut by a slight 0.74 to 77.1 million bales. The Cotlook A index was down 65 points from the previous day at 97.20 cents/lb on August 9. The weekly USDA AWP was updated to 79.68 cents/lb today, down 39 points from the previous week.

Oct 18 Cotton closed at 85.860, down 140 points,

Dec 18 Cotton closed at 85.230, down 203 points

Mar 19 Cotton closed at 85.710, down 198 points

Market Commentary provided by:

Brugler Marketing & Management LLC
1908 N. 203rd St.Omaha, NE 68022
Phone: 402-697-3623
Fax: 402-289-2353

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