The following commentary does not necessarily reflect the views of AgWeb or Farm Journal Media. The opinions expressed below are the author's own.
The following commentary does not necessarily reflect the views of AgWeb or Farm Journal Media. The opinions expressed below are the author's own.
Paul Georgy serves as president/CEO of Allendale, Inc., a worldwide agricultural advisory and research firm that provides agricultural commodity price research and risk management alternatives for producers, major food companies, international corporations, foreign governments, and major news vendors.
Good Morning! From Allendale, Inc. with the early morning commentary for March 9, 2018.
Grain markets react to the latest set of data from USDA as well as the prospect of trade retaliation after the new Trump tariffs. Don't forget, Daylight Savings Time begins Sunday. Set your clocks ahead one hour for the Sunday night reopen.
Today is the last day of our Planted Acreage Survey. We could still use your help - report your data online Click Here or call 800-262-7538. The results will be released on March 14 during a live Ag Leaders Webinar (Register Here).
USDA lowered its ending stock forecast for corn yesterday from 2.352 billion bushels to now 2.127. Analysts had expected 2.312. Exports were sharply raised by 175 million bushels. World stocks were lowered from 203.1 million tonnes last month to 199.2. USDA cut Argentina by 3 million tonnes to now 36. They lowered the Brazilian crop slightly, from 95.0 to 94.5 mt.
Soybean ending stocks were increased from 530 million bushels last month to 555. Analysts were expecting no change at 530. Exports were lowered by 35 million bushels, while crush was raised by 10 million bushels despite the fact we are behind in meeting their February number. World stocks were lowered from 98.1 to 94.4 million tonnes. Argentina was lowered from 54 million tonnes to 47 for production. Brazil’s crop was raised from 112.0 to 113.0.
Wheat Ending stocks were raised from 1.009 billion bushels to 1.034. The trade estimate was 1.015. The only change on the balance sheet was a 25 million drop for exports. World stocks were raised from 266.1 million tonnes to 268.9.
Weekly export sales for the week of Friday February 23 - Thursday March 1 had soybean sales totaled 2,653,373 metric tonnes combined (2,509,473 for 2017/18), a record for this particular week. Year to date sales come to 1.764 million bushels.
Corn sales were reported at a combined 1,927,838 metric tonnes (1,857,557 for 2017/18). This was over the 1,000,000 - 1,600,000 trade expectation. Over the past eight weeks we have sold 552 million bushels of corn, a record amount for that time frame.
Wheat sales totaled 428,374 metric tonnes (391,476 for 2017/18). The trade expectation is 200,00 - 600,000. Year to date sales come to 809 million bushels, but with the marketing year ending May 31, today's WASDE revision lower was justified.
The US Climate Prediction Center forecasts the transition from La Nina to neutral readings would be seen in the March - May period. They see neutral conditions in the second half of the year.
Record open interest levels were reached in corn yesterday at 1.78 million contracts, beating the previous record of 1.75 million from February 2011.
Funds were estimated buyers of 28,000 corn contracts, and 2,000 wheat in yesterday's trade. They were sellers of 4,500 soybeans, 2,000 soymeal, and 2,000 soyoil.
President Donald Trump today unveiled a finalized plan to impose tariffs of 25 percent on steel imports and 10 percent on aluminum, with provisional exceptions for Canada and Mexico. The tariffs could trigger a trade war with the European Union, China and other countries unless they are also exempted. The EU has threatened to retaliate against roughly $3.5 billion in U.S. exports if its member countries are hit with the duties. A battle at the World Trade Organization is also a possibility, as the EU and a number of other U.S. trading partners are expected to challenge the action before the international trade body if they are not given carve-outs. (Politico)
Nonfarm payrolls lead the economic data out today, along with the Unemployment Rate at 7:30 AM CST. Wholesale inventories will also be out today at 9:00.
Cash pork fell 1.70 on Tuesday, 3.21 Wednesday, and 1.72 yesterday. That is -6.63 in just three days!
USDA raised their 2018 pork production estimate by 25 million lbs. At 26.910 billion lbs. this is a new record and 5.2% over last year.
USDA lowered the 2018 beef production estimate by 40 million lbs on the monthly supply/demand report. They may still be a bit high on their number at 5.8% over last year.
Dressed beef values were higher with choice up .31 and select up 1.58. The CME Feeder Index is 144.72. Pork cutout value is down 1.72.
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