Ag Market Commentary

Corn is 4 to 6 cents per bushel higher this morning, chasing the wheat rally from Wednesday. On Wednesday, corn futures rallied late in the day for gains of 1 1/4 to 3 1/4 cents. July to Dec carry is now 7 1/2 cents. Analysts estimate USDA’s weekly update will show 300,000 to 600,000 MT of old crop corn export bookings. New crop export sales are estimated 150k-500k MT. EIA data showed 914k bpd of ethanol produced, an average daily production increase of 14k bpd. Ethanol stocks were 20.6m barrels, which was the first weekly increase in 10 weeks. The East Coast’s ethanol stocks have dropped 3.325m barrels to a 3-yr low after setting the all-time high on April 10. Argentina’s corn harvest was 81.7% complete through July 8. BAGE also reported yields are averaging 8.4 MT/HA (133.8 bpa), and maintains the 50 MMT production forecast. Brazil is reportedly 27% harvested for this year’s second crop. CONAB also lowered their corn production forecast to 100.56 MMT, with a 0.7 MMT cut to second crop. The triple crop estimates was up 1.2 MMT. Traders anticipate the July WASDE will also cut Brazil’s production, with an average estimate of 100.4 MMT down 0.6 from June.

--- provided by Brugler Marketing & Management



Beans are 5 to 8 cents higher ahead of the weekly Export Sales report. On Wednesday, soybean futures were 1 to 5 3/4 cents lower. Soymeal futures had losses of $1.50 to $1.70/ton. Bean oil futures were 30 to 33 points lower at the closing bell. Ahead of USDA’s weekly Export Sales report, trade estimates are for 300-800,000 MT of old crop soybean sales and 0.4-1 MMT for new crop. Soymeal sales are estimated between 75,000 and 250,000 MT, with 5k to 25k MT for oil. A pre-report poll of analysts suggests traders expect a 0.7 MMT cut to 123.3 MMT for Brazil’s production. CONAB’s July estimate is 120.9 MMT. Argentina soybean oil export prices posted a 3 month high $684.8/MT (2.2 c/lb) after the EU purchased 3 cargoes of biodiesel.

--- provided by Brugler Marketing & Management



Following the double digit gains from Wednesday, moves, wheat markets are another 1 to 3 cents higher. Black Sea wheat futures traded the highest price since June 4 on concerns about poor yields in early harvested Russian fields. Chicago SRW futures closed yesterday’s session 17 1/4 to 25 1/4 cents higher. HRW futures were up by 13 3/4 to 16 cents. HRS wheat futures closed 9 1/2 to 10 3/4 cents higher. The SRW premium over corn widened, after the narrowest spread since March 16 on Monday. Currently its near $1.50/bushel, still no substitution threat in most of the world. July to July peaked on April 21 at ~ $2.40/bu. USDA’s weekly Export Sales report is estimated to show between 200,000 and 550,000 MT of wheat sales. Day 16 of the KS wheat harvest reported yields were 20 bpa to 55 bpa, with most in mid to upper 40s. Traders estimate USDA will increase 19/20 world ending stocks 1.5 MMT to 297.3 MMT on Friday. IKAR lowered their Russian new crop wheat production forecast by 1.5 MMT to 78 MMT. The French Farm Ministry released their initial wheat production forecast of 31.31 MMT. If realized that would be a 21% drop yr/yr. The ministry attributed dryness and poor weather for the low forecast.

--- provided by Brugler Marketing & Management



Front month live cattle futures had 22 to 85 cent losses yesterday. Feeder cattle futures closed with 42 to 87 cent losses in the front months. The July 6 Feeder Cattle index was $130.13. Cash cattle sales on Wednesday were mostly at $95, with limited IA and CO activity @ $99-$100. USDA confirmed cash sales this week are mostly $95 so far, with the full range $90-$101.50. Wholesale boxed beef prices were lower in the PM update. USDA reported Choice boxes at $203.83, a $1.47 drop. Select boxes were $195.52 cwt, down by $1.32. The week’s cattle slaughter is 354,000 head through Wednesday. That trails last week by 9,000 head and is 3k head below the same week last year.

--- provided by Brugler Marketing & Management




Wednesday hog trading was directionless. October and Dec contracts closed 17 and 10 cents higher respectively, where the other futures were down by as much as 92 cents. July futures closed at $44.05. The CME Lean Hog index for July 6 was 24 cents higher to $45.90. The National Average Base Hog price for Wednesday afternoon was 23 cents lower to $29.14. The 5-day average is at $29.04. 10. USDA’s National Pork Carcass Cutout Value was up by $4.56 to $67.16, the largest daily increase since Cinco de Mayo. Ham primals jumped $16.03 cwt. to $54.22, and bellies were back above $100 cwt. FI hog slaughter for the week through Wednesday is 1.388m head. That compares to 1.406m head last week and 1.442 million from the same week a year ago.

--- provided by Brugler Marketing & Management



Expiring July Cotton is down 256 points this morning, with shadow October also in the red. The December and later contracts are up 19 to 36 points. The Wednesday session ended with gains. Dec cotton was still the lowest front month futures contract, despite gaining triple digits on Wednesday. Dec was at a 41 point discount to October and 53 points below Mar ‘21. Tuesday sales on the Seam added 1,744 bales to the week’s total. The average gross price was 60.61 cents/lb. CONAB reported Brazilian cotton harvest at 9% complete. The 1.67m HA (4.12m acre) area is 3.1% higher yr/yr and yields are also higher yr/yr. The June WASDE forecast for Brazilian cotton production is 13.2m bales. The July 7 Cotlook A index was another 75 points lower to 69.70 c/lb. The AWP for cotton is 50.13 cents/lb, and the LDP is 1.87 cents, both will be updated after the close.

--- provided by Brugler Marketing & Management






Market Commentary provided by:

Brugler Marketing & Management LLC
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Phone: 402-697-3623
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