CORN
Corn futures were unchanged overnight with some minor movement ahead of today’s USDA WASDE report. December corn, at 5.10 is down 14 cents this week and sits atop it’s 200-day moving average price support. The average yield is expected to be 175.5 bushels per acre (BPA), a slight improvement from the Aug estimate of 174.6. Attention will focus on planted acres which could see an increase in supply, beginning stocks and planted area. A social media post revealed FSA was scheduled to release its 2nd batch of certified acreage data Friday after USDA’s September crop reports, but the data appeared on the FSA site mid-week. As of Sep 1, FSA reported corn acres at 91.2 million acres, up from 90.3 million acres reported in Aug. Trade estimates for this morning’s USDA Weekly Export Sales (delayed due to 3-day holiday weekend) are 600,000 to 1.20 mil tons for 2021-22 marketing year corn.
SOYBEANS
The soybean complex was mixed with a firm tone overnight. Nov beans are up 2-1/2 cents this morning to 12.73 and down 19 cents for the week ahead of what many believe will be a bearishly construed USDA production number in the Supply/Demand update. USDA will revise U.S. 2021 soybean crop and adjust demand in today’s report and the agency might also increase U.S. 2021 yield and crop size close to 4.377 bil bu vs USDA 4.339. They could also lower U.S. 2020/21 soybean total use potentially adding to U.S. 2021/22 soybean carryout to an estimated 190 compared to USDA’s last estimate of 155. Meanwhile, trade estimates for this morning’s USDA Weekly Export Sales are 1.0 to 1.6 mil tons for 2021-22 marketing year.
WHEAT
Wheat futures were mostly flat overnight after a 3-day price drop. Dec Chicago wheat is at 6.91 and down about 30 cents for the week. Dec KC wheat is now at 6.83 after losing 40 cents this week; And, Dec MPLS spring wheat is down 3-1/2 cents this morning to 8.69 after breaking support on losses of 43 cents for the week. FSA numbers suggest wheat acres could be 500,000 acres higher than trade expectations for today’s report. Australian wheat production is being pegged at near record large at 32.6 mmt, which is still below USDA’s last estimate last month of 30 mmt. A recent farmer poll suggested U.S. all wheat acres could increase to 49.7 million vs 46.7 last year. The trade estimates for World wheat end stocks near 279 mmt vs USDA 279 with non-China and India stocks near 111 mmt. Trade estimates for U.S. 2021/22 wheat carryout is near 616 vs USDA 627. Demand-wise, the situation is still bullish on a global scale. We’ll see if U.S. supplies are gaining any traction with global wheat prices increasing, potentially making U.S. wheat more competitive in this morning’s USDA Weekly Export Sales report. Trade estimates are 200,000 to 450,000 tons.
CATTLE
Cattle are called steady to lower after October cattle lost ground 9 out of the last 10 days. October cattle is still searching for a seasonal low, but prices did hold the key 200-day moving average yesterday afternoon and consolidated within Wednesday’s trading range. Price action was still soft overall as futures slid off early session gains and the technical weakness will likely keep sellers in the market. The cash market helped provide some support, as October pulled in line with cash trade on the week. Light trade was reported in the South with sales at $124, steady to $1 higher than last week. In the North, light trade is also being reported in parts at $203, a little more than $1 higher. Thursday’s slaughter totaled 120,000 head, 1,000 more than last week, but 1,000 less than a year ago, as packers keep that 120,000 target in focus for daily slaughter. Both cattle markets are technically weak, but moving into oversold conditions. This could bring a bounce, but until the fundamentals firm, and money flow turns more positive, the path is still lower.
HOGS
Hogs are called steady to lower unless this morning’s delayed Weekly Exports offer support. October hogs were range bound this past week, with $90.00 being a magnet, but the selling pressure the past two days has pushed prices to the bottom of the range, challenging support the below. The weakness on Thursday puts October near the bottom of the range, and could support prices. However, the fundamentals are still softer, with the cash market trending mostly lower. Closing National Direct Daily Hogs prices were lower, losing 3.29 to $86.42, with a range of $84.00 to $91.00 on a carcass base price. Live prices were also .24 lower to $69.42. The soft cash close will pressure prices today as reflected in the Lean Hog Cash index, which was .56 lower to 98.74. The pork carcass cutout was slightly higher at midday, but closed softer, losing 1.70 to 108.70. Load count was moderate at 170 loads.
Author
Matthew Strelow