Ag Market Commentary
BRUG - Fri May 10, 5:26PM CDT

Corn futures closed Friday with most contracts steady to 2 cents lower in the front months and higher in some 2020 contracts. July futures lost 5.12% this week. The barrage of USDA data showed old crop corn ending stocks 60 mbu higher than in April at 2.095 bbu. Their initial new crop projection is 2.485 bbu, a 390 mbu jump from the current 18/19 number and near the top end of the wide range of pre-report estimates. Production was estimated at 15.03 bbu based off a 176 bpa yield. Brazil corn production was raised 4 to 100 MMT, with Argentina up 3 to 49 MMT. World corn production for 18/19 was up 12 MMT, mainly from South America, which when mixed with lower feed use caused expected carryout to jump 11.93 MMT at 325.94 MMT. New crop carryover for 2020 was projected at 314.71 MMT. The Friday afternoon Commitment of Traders report showed managed money specs in corn futures and options trimming their net short position as of May 7 by 24,372 contracts to 282,327 contracts.

May 19 Corn closed at $3.42 1/2, down 2 cents,

Jul 19 Corn closed at $3.51 3/4, down 1 1/2 cents,

Sep 19 Corn closed at $3.61, down 1 cent

Dec 19 Corn closed at $3.72, down 3/4 cent

--provided by Brugler Marketing & Management

Soybean futures ended the Friday session with the front months 1 to 3 1/2 cents lower. July was down 3.92% on the week. Meal futures were down $1.20/ton, with May soy oil 16 points higher. The monthly WASDE update from USDA showed old crop soybean stocks increasing 100 mbu from last month to 995 mbu, on a reduction to exports. Production for the upcoming season was pegged at 4.15 bbu, with a 49.5 bpa weather adjusted trend yield projection. New crop carryout was seen initially at 970 million, a 25 mbu drop from the 2019 number. USDA left Brazilian soybean production at 117 MMT, with Argentina up 1 at 57 MMT. Chinese imports for 18/19 are now seen at 86 MMT. World carryout for old crop is up 5.82 MMT to 113.18 MMT. New crop was projected at 113.09 MMT. Money managers in soybean futures and option held a record reported net short position of 160,553 contracts on Tuesday, a move of 12,027 contracts from last week. Chinese trade reps left DC with no trade agreement as expected but hinted at future talks to continue.

May 19 Soybeans closed at $7.97, down 3 1/4 cents,

Jul 19 Soybeans closed at $8.09 1/4, down 3 1/2 cents,

Aug 19 Soybeans closed at $8.15 3/4, down 3 3/4 cents,

Nov 19 Soybeans closed at $8.33 1/4, down 2 1/2 cents,

May 19 Soybean Meal closed at $284.10, down $1.20,

May 19 Soybean Oil closed at $26.50, up $0.16

--provided by Brugler Marketing & Management

Wheat futures posted 6 to 10 3/4 cent losses in most KC contracts on Friday, with July down 3.61% this week. CBT lost 3.03% since last Friday’s close, as today’s losses were 2 to 5 cents. MPLS was fractionally mixed in most contract. USDA showed old crop US stocks at 1.127 bbu, a 40 mbu jump from April, on lower feed & residual and a 20 mbu reduction to exports. New crop stocks are expected to rise 14 mbu to 1.141 bbu. Production for 2019 is seen at 1.897 bbu, with all winter 1.268 bbu of that. HRW production came in at 780.38 mbu, with SRW at 264.57 mbu, both below expectations. USDA just used weather adjusted trend yield for this report. The WASDE did show a 0.63 MMT reduction to world ending stocks at 274.98 MMT for the 18/19 crop. The first 19/20 estimate of the year was 293.01 MMT, a 18.03 MMT yr/yr jump with sharp recoveries in production for Australia, Canada and Russia (still well below private estimates at 77 MMT) among others. Much of this is already priced into the market. Spec traders in the KC wheat futures and options market extended their record large net short to 58,866 contracts as of Tuesday.

Jul 19 CBOT Wheat closed at $4.24 3/4, down 4 3/4 cents,

Jul 19 KCBT Wheat closed at $3.87, down 10 3/4 cents,

Jul 19 MGEX Wheat closed at $5.17, down 1/4 cent

--provided by Brugler Marketing & Management

Live cattle futures saw 50 cent to $2.075 gains in most contracts on Friday. Feeder cattle futures were up $1.375 to $2.825 on the day. CFTC data showed managed money dropping their net long position in live cattle futures and options by 24,881 contracts as of Tuesday to 104,701 contracts. The two-week drop of 49,849 contracts is the largest on record. The CME feeder cattle index was down 32 to $135.52 on May 9. Wholesale boxed beef prices were mixed on Friday afternoon. Choice boxes were down $1.36 at $221.11 with Select boxes 38 cents higher @ $207.46. USDA estimated this week’s FI cattle slaughter at 664,000 head through Saturday. That was down 6,000 head from the previous week and 9,000 above the same week last year. Monthly Trade data from Census shows US beef exports in March at 245.875 million pounds. That was larger than February by 15.9% but 5.7% larger than the same month in 2018. USDA projected 2019 beef production at 27.269 billion pounds, a 11 million pounds drop from April. Production for 2020 is seen at 27.51 million pounds in USDA’s initial projection.

Jun 19 Cattle closed at $112.450, up $0.500,

Aug 19 Cattle closed at $108.900, up $1.300,

Oct 19 Cattle closed at $109.025, up $1.375,

May 19 Feeder Cattle closed at $137.625, up $1.375

Aug 19 Feeder Cattle closed at $146.825, up $2.350

Sep 19 Feeder Cattle closed at $147.775, up $2.500

--provided by Brugler Marketing & Management

Lean Hog futures were steady to 60 cents lower in the front months, with deferred contracts higher. June was down 3.32T this week. The CME Lean Hog Index was up 8 cents from the previous day @ $82.76 on May 8. The USDA pork carcass cutout value was down 66 cents at $86.16 on Friday afternoon. The national average base hog was $80.80 on Friday, up 28 cents from the previous day. Estimated weekly FI hog slaughter was 2.341 million head through Saturday. That was 41,000 head below the previous week but 35,000 above the same week last year. Pork exports during March were reported at 515.412 million pounds according to Census data. That was a jump of 13.9% mo/mo but down 4.2% from last year’s March record. Pork production for 2019 was down just 2 million pounds from last month to 27.323 billion in this morning’s USDA estimate. Their initial 2020 production projection is 28.285 billion pounds.

May 19 Hogs closed at $83.750, unch,

Jun 19 Hogs closed at $89.675, down $0.325

Jul 19 Hogs closed at $90.750, down $0.225

--provided by Brugler Marketing & Management

Cotton futures posted triple digit losses in the front months on Friday, as July was down 9.55% this week. In this morning’s monthly WASDE update, cotton’s 2018/19 US balance sheet saw a 250,000 bale increase to stocks at 4.65 million bales, thanks to a reduction to exports. The first 19/20 balance sheet of the year showed a huge 1.85 million bales jump in new crop carryout to 6.4 million bales, with production seen at 22 million bales and exports of 17 million bales. World cotton stocks for old crop saw a marginal 0.03 increase to 76.47 million bales. New crop is seen at 75.69 million bales, with Chinese imports expected to increase 2.5 million bales to 11 million. Chinese trade reps headed back to China on Friday as talks were “constructive” according to President Trump. The weekly Average World Price (AWP) is now 64.65 cents/lb, down 3.62 cents from last week. Spec in cotton futures and options flipped their net position back to short by 15,088 contracts in the week of May 7 to -4,841 contracts.

Jul 19 Cotton closed at 68.450, down 178 points,

Oct 19 Cotton closed at 69.650, down 112 points

Dec 19 Cotton closed at 69.400, down 117 points

--provided by Brugler Marketing & Management

Market Commentary provided by:

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Phone: 402-697-3623
Fax: 402-289-2353

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