Afternoon Market Highlights


Highlights

  • The U.S. tariff increase from 10% to 25% on Chinese goods went into effect early this morning. A deal was not reached during this round of discussion in Washington.
  • Last trading day for May grains, oilseeds, and lean hogs is May 14th. It is also the last trading day for May lean hog options.
  • CHS Hedging is offering a variety of classes over the summer including Grain Hedging I & II, Energy Risk Management, and Introduction to Technical Analysis. For more information and to register please visit www.chshedging.com.

 Corn

The corn market traded both sides of the market today before closing mixed. Corn was affected today by the bearish WASDE report, as both the U.S. and world ending stocks were raised. Another factor to the market tone is the improving weather. On Monday afternoon the next crop progress report will be released, showing how far along corn planting is. The average for Monday is 66%, with estimates near the low thirties. For the week, July corn lost 20 ½ cents.

  • U.S. old crop ending stocks were raised from the April stocks number of 2.035 billion bushels to 2.095 billion bushels. The new crop ending stocks were placed at 2.485 billion bushels.
  • World ending stocks for 2019/2020 were 314.71 million metric tonnes, above the April stocks number of 314.01 million tonnes.
  • The Commitment of Traders report showed that speculators removed 16,326 contracts from their net short position, bringing them to a net short of 301,166.
  • Closes: July at $3.51 ¾ down 1 ½; September at $3.61 down 1; December at $3.72 down ¾; March at $3.86 ¼ down ½.
  • Spreads: N/U 9 ¼ cent carry; U/Z 10 ¾ cent carry; N/Z 20 ¼ cent carry; Z/H 14 ½ cent carry.

 Oilseeds

Soybeans traded both sides of the board today before closing mostly lower. The day was surrounded by bearish news in the market. The USDA raised their ending stocks for both the world and the U.S. as the global hog herd is declining due to ASF. This in turn lowers the soybeans needed for feed. The U.S. and China also failed to come to a trade deal today as the talks in Washington concluded. For the week, July beans lost 33 cents.

  • U.S. old crop ending stocks were raised from the April stocks number of 895 million bushels to 995 million bushels. The new crop ending stocks were placed at 970 million bushels.
  • World ending stocks for 2019/2020 were 113.09 million metric tonnes, above the April stocks number of 107.36 million tonnes.
  • The Commitment of Traders report showed that speculators added 6,528 contracts to their net short position, bringing them to a net short of 167,981 contracts.
  • Closes: July at $8.09 ¼ down 3 ½; August at $8.15 ¾ down 3 ¾; November at $8.33 ¼ down 2 ½; January at $8.46 ¾ down 1 ¾.
  • Spreads: N/Q 6 ¾ cent carry; Q/X 17 ½ cent carry; N/X 24 ¼ cent carry; X/F 13 ½ cent carry.

 Wheat

The wheat market traded lower today alongside of corn and beans after the bearish WASDE report was released. Kansas City wheat took the brunt of the losses and was followed by Chicago and Minneapolis wheat. For the week, July Chicago lost 13 ½ cents, July Kansas City lost 15 ¼ cents, and July Minneapolis gained 2 cents.

  • U.S. old crop wheat ending stocks were raised from the April stocks number of 1.087 billion bushels to 1.127 billion bushels. The new crop ending stocks were placed at 1.141 billion bushels.
  • World ending stocks for wheat were placed at 293.01 million metric tonnes, above the April stocks number of 275.61 million metric tonnes.
  • U.S. winter wheat production is forecast at 1.27 billion bushels with a yield prediction of 50.3 bushels per acre.
  • The Commitment of Traders report showed that speculators removed 2,922 contracts from their net short position, bringing them down to a net short of 114,911 contracts in Chicago wheat. For Kansas City wheat they removed 145 contracts leaving them net short 52,464 contracts.
  • July Closes: Chicago at $4.24 ¾ down 4 ¾; Kansas City at $3.86 ¼ down 11 ½; Minneapolis at $5.17 ¾ down ¼.
  • Spreads: Chicago N/U 8 ½ cent carry; Kansas City N/U 10 ¾ cent carry; Minneapolis N/U 8 ¾ cent carry.

 Livestock

The cattle market traded higher today to end the week. The feeder cattle led the way higher and were followed by live cattle.  The cattle market saw a bounce today after a sell-off that has been occurring since the end of April. Hogs were mixed today and closed mixed as well. The volatility in the hog market is likely related to the unknowns regarding China. The carcass cut out values have remained firm, although the ribs and hams were lower.

  • Feeder closes: May at $137.90 up $1.65; August at $146.60 up $2.025; September at $147.35 up $2.075.
  • Live closes: June at $112.525 up $0.575; August at $108.925 up $1.325; October at $109.00 up $1.35.
  • Lean closes: June at $89.40 down $0.60; July at $90.425 down $0.55; August at $92.20 down $1.05.
  • Packer margins were estimated at $101.90 for beef and $5.60 for pork.
  • Today’s slaughter was estimated at 118,000 cattle vs 120,000 last year and 439,000 hogs vs 436,000 last year.
  • Afternoon boxed beef values on 111 loads: Choice at $221.11 down $1.36; Selects at $207.46 up $0.38.
  • Afternoon pork product values on 230 loads: carcass cutouts at $86.16 down $0.66; loins at $80.13 up $0.13; ribs at $161.57 down $8.19; hams at $67.43 down $4.81; bellies at $129.93 up $5.43.