Ag Market Commentary
Corn futures are trading fractionally higher this morning after closing 2 1/4 to 3 1/2 lower on Wednesday. The weekly EIA report is delayed until this morning. Harvest progress across most of the Corn Belt is lagging the average pace, with IA only 8% complete and IL 38% harvested. The national average basis is 2 cents weaker than one year ago, due to larger carryover stocks. Cash prices are on average one cent higher. Condition ratings in NE were down 4 points this week in the Brugler500 Index, as IA was up 3 and IL improved 9 points. Analysts are expecting to see a 0.56 MMT drop in world ending stocks for 17/18 to 201.91 MMT in this morning’s USDA report. Celeres expects the Brazil 17/18 first season corn crop production to drop to 28.1 MMT, as acreage is expected to be trimmed 15.3% to 13.42 million acres.

Soybean futures are currently 2 3/4 to 3 cents higher ahead of this morning’s USDA report. They ended Wednesday fractionally lower in the front months, with back months as much as a penny higher. Oct soy meal was down $1.30/ton, with nearby bean oil up 5 points. Soybean harvest in IA was 19% behind their 5-year average, at 26%, with NE harvesting just half of their typical amount for this week at 23% complete. Progress in the ECB was improving over the last week, with drier weather. Conditions in NE and MN were down 3 points, while IL was up 6 with IA 3 points higher in the Brugler500 Index. World ending stocks are projected to be slightly lower in Thursday’s WASDE report @ 97.2 MMT. Brazil’s 17/18 soybean crop is expected to drop to 109.8 MMT according to Celeres.

Wheat futures are UNCH to 1 cent higher this morning. They finished Wednesday 2 to 5 cents lower in most CBT and KC contracts, while MPLS was slightly higher. Wednesday morning’s USDA announcements also included a private export sale of 104,200 MT of HRW to Mexico for 17/18 delivery. The USDA reported KS planting progress was only 27% complete, with OK 20% below their average. Most SRW states were ahead of their average pace. Traders are estimating the USDA will lower the world wheat ending stocks number by 0.34 MMT to 262.8 MMT in Thursday’s monthly report.

Live cattle futures were mixed on Wednesday, with nearby Oct 7.5 cents higher. Feeder cattle futures were mostly lower as nearby Oct was up 7.5 cents. The CME feeder cattle index was 5 cents higher at $155.22 on October 10.Wholesale beef prices were lower in the Wednesday afternoon report. Choice was down $1.08 at $196.32, while select boxes were $1.26 lower at $188.76. Week to date FI cattle slaughter was estimated at 351,000 head through Wednesday, about 9,000 larger than the previous week and 8,000 head above the same week last year. Wednesday morning’s FCE online auction showed no sales of the 1,391 head that were offered, as sales of $110-$110.75 were passed by feedlots.

Lean hogs futures posted gains of 2.5 cents to $1.075 in the front months, as deferred contracts were lower. The CME Lean Hog Index for 10/9 was 69 cents higher than the previous day at $57.11. The USDA pork carcass cutout value was 4 cents lower at $73.67 in the Wednesday afternoon report. The ham and belly were the only cuts reported higher. The national base hog carcass price was 82 cents higher in the PM report at $55.82. Estimated weekly FI hog slaughter was 1,389,000 head through Wednesday, 22,000 head ahead of last week and 216,000 larger than the same week in 2016. The two new plants continue to ramp up production.

Cotton futures are 20 to 30 points lower this morning after they were mixed yesterday. The US dollar was 376 points lower yesterday. The dollar was weaker again last night but has turned higher this morning. The USDA reported harvest progress in TX was at 27% vs. the average of 19%, as GA was 19% complete. Cotton conditions in TX improved 8 points for that week. Analysts are looking for little change to world cotton ending stocks in today’s. There is keen interest in the US average yield, given improving Texas ratings, but also storm damage in the Southeast. The Cotlook A index for October 10 was even with the previous day at 78.80 cents/lb. The Export Sales report will be delayed until Friday morning due to the Monday federal holiday.

Market Commentary provided by:

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