Afternoon Market Highlights
1/28/2019 3:05:33 PM
The Ag markets were quiet ahead of the trade war talks and frigid temperatures heading for much of the US this week. The market should start to function better as the government begins to release market data, after being shutdown for the past 34 days.
- USDA announced they plan to release the January 11th production, stocks and seedings reports on February 8th when they are scheduled to release their updated US and world balance tables.
- The USDA also plans to extend the farm aid deadline until February 14th.
- Egypt’s GASC is in for optional origin wheat for March 11-20.
- Energy markets were weaker with crude oil down 1.54 at $52.15/barrel.
- The DJIA, S&P and the NASDAQ are all weaker this afternoon.
The corn market traded both sides in a 2-3-cent trading range. Export inspections were good but not what the trade was expecting. The corn market appears to be caught in a narrow range until we get fresh information to provide market direction. Closes: March at $3.79 ½, down ½ cent, July at $3.96 ¼, down ¼ cent and December at $4.03, down ¼ cent.
- Weekly export inspections were reported at 893 tmt, below trade estimates at 900 tmt-1.0 mmt.
- CIF premiums were 3 cents firmer for Jan and 1-2 cents firmer for Feb. ECB processor bids are steady to 3 cents firmer.
- Spreads: H/K 8 ½ carry, K/N 7 ¾ carry, N/U 2 ½ carry, U/Z 4 ¼ carry.
The soybean market traded lower on profit taking and rain events in Brazil over the weekend. Prices spent much of the session clawing its way back toward positive territory. The March contract dipped below its 200-Day MA but bounced back to close above it. Closes: March at $9.23 ¼, down 2 cents, July at $9.49 ¾, down 2 cents and November at $9.62 ¼, down 2 cents.
- Weekly export inspections were reported at 929 tmt, below trade estimates at 1.0-1.4 mmt.
- CIF premiums were 3 cents weaker for Jan and 1 cent firmer for Feb. ECB processor bids were mostly unchanged.
- The canola market closed lower on hedge pressure from increased farmer selling.
- ABOIVE pegs Brazil soybean exports at 70.1 mmt versus 73.9 in December. They also estimate the Brazilian production at 117.0 mmt.
- Say the Brazilian bean crop is 117.0 mmt and the Argentine bean crop is at 55.0 mmt. That makes their combined crop at 172.0 mmt, which would be above their total production for much of the past 5 years (2015 @ 167 mmt, 2016 @ 163 mmt, 2017 @ 180 mmt, 2018 @ 168 mmt and 2019 @ 172 mmt in this case but in December the USDA estimate was at 187 mmt). On top of that US ending stocks are currently estimated at 955 mb with expectations of reaching 1.0 billion bushels or higher. And we are 3-4 months away from planting another soybean crop in the US.
- Spreads: H/K 13 ¾ carry (70% of full carry), H/X 39 carry.
The wheat market traded higher earlier in the day but failed to hold at those levels. Cold weather across the US should halt movement. There could be concerns of damage to the winter wheat from the frigid temps, especially where there is limited snow cover. March closes: Mpls at $5.74, down ¾ cents, KC at $5.06 ¾, down 3 ¼ cents, and Chicago at $5.18 ¾, down 1 ¼ cents.
- Weekly export sales inspections came in at 362 tmt, below trade estimates at 450-650 tmt.
- Spreads: Mpls H/K 2 ¾ carry and looks to be heading for even money. The Kansas City H/K closed at a 10-cent carry.
The cattle market was stronger on ideas of slowed movement from recent cold temperatures and expected extreme cold temperatures this week. Cash markets traded last week at $123 but have not been defined this week. Offers are at $127 on a live basis and $200 dressed. Closes: March feeders at $144.45, up 82 cents, April feeders at $145.67, up 95 cents, Feb lives at $126.47, up 42 cents, April lives at $127.32, up 47 cents and June lives at $117.02, up 32 cents.
- Packer margins this morning were reported at $62.60 versus $31.85 a week ago.
- AM Boxed Beef values on 67 loads: Choice at $217.60, up 59 cents and Selects at $212.66, up 63 cents. The C/S spread was at $4.97.
- First notice day for February live cattle is Feb 4 and the last trading day for Feb live cattle is Feb 28th.
- The last trading day for January feeder cattle and feeder cattle options is January 31st
The hog market traded mostly lower on weaker cash values. The products were stronger this morning although carcass cutout values remain below $70/cwt. Movement has been big but the cold wintry weather conditions this week are expected to slow movement. Closes: Feb at $57.97, down 47 cents, April at $62.32, up 5 cents and June at $76.72, down 65 cents.
- Packer margins came in at $25.00 versus $28.75 a week ago.
- AM Pork Product values on 109 loads: Carcass at $69.65, up 1.95, loins at $67.71, up 80 cents, ribs at $127.45, up 38 cents, hams at $50.24, up 2.90 and bellies at $121.48, up 2.26.
- Cash markets were 5-35 lower at a weighted average of $50.94 with a range from $46-$52.
- The last trading day for February lean hog futures and options is February 14th.