Ag Market Commentary

Corn futures are trading fractionally higher this morning after they closed 1/4 to 1 1/2 cents lower on Friday. The exception is nearby March, down a penny. March was up 11 cents per bushel for the week. Total commitments for corn exports are now just 8% behind last year, gaining 2.5% since last week. The Buenos Aires Grain Exchange put Argentine corn crop conditions at 5.5% good with 76.4% rated as poor/very poor. They left their production estimate at 37 MMT for the 17/18 crop. Consultant Informa is projecting 33.5 MMT. A Bloomberg survey found that trade average guess was 36.5 MMT. The average expectation for Brazil was 91.6 MMT vs. the February USDA figure of 95 MMT.

Soybean futures are 2 to 3 cents higher this morning. They settled 1 lower to 3 higher on Friday. Nearby Soymeal futures were down $3.80/ton on Friday, with nearby soy oil down 6 points. Soybean export commitments as of Feb 22 for soybeans were 12.5% lower than the same time last year. BAGE trimmed their expected Argentine soybean production number 3 MMT to 44 MMT. Informa is also apparently at 44 MMT. The average trade guess is still 48.5 MMT in a Bloomberg survey. USDA was at 54 MMT for Argentina in February. They will update on March 8. Brazil was 113.9 MMT in the same survey, but AgRural is up at a record 117.9 MMT! Brazil exported 2.864 MMT of soybeans during February according to their country’s Trade Ministry. That was 83.12% larger than January, but down from last year by 18.9%. SAFRAS estimated that 31% of the Brazilian crop is harvested, lagging the 39% average and last year’s 46%. The delay is all in the south, with Mato Grosso ahead of the 5 year average.

Wheat futures are trading 1 to 4 cents higher in the HRW and SRW contracts this morning, with the MPLS spring wheat most more than a penny per bushel lower. They posted double digit losses in MPLS and Chicago futures on Friday and just barely avoided them in KC HRW with its 8 3/4 to 9 3/4 cent losses. Even after the sell off, KC March was up 53 cents per bushel for the week (11.3%) on declining crop condition ratings. Wheat export shipments totaled 330,694 MT last week, falling 20.9% from the previous week total and 35.53% behind the same week last year. Commitments for all wheat exports are now 12.4% lower than this time in 2017. They are 84% of the USDA projection, vs. 93% last year and the average of 92%.

Live cattle futures were down anywhere from 7 cents to $1.15 on Friday, with the front two contracts in triple digit territory. Feeder cattle futures were off $.80 to $1.47. The CME feeder cattle index was down $1.30 cents on March 1 at $146.03. Wholesale boxed beef values were mixed. Choice boxes were up 22 cents at $222.52, with Select boxes $0.96 lower at $214.64. Estimated weekly FI cattle slaughter was 608,000 head, up 6.3% from last week and up 3.8% from the same week in 2017. Cash cattle trade was mostly $126 on Friday, with $203-205 reported in the north.

Lean hog futures settled mixed on Friday, with nearby April up 60 cents. The CME Lean Hog Index on February 28 was $68.36, down 21 cents from the previous day. US Pork export commitments were 6.6% larger than a year ago through February 22. The USDA pork carcass cutout value was 73 cents higher at $78.11 in the Friday afternoon report, with loins adding the value. Bellies were down more than 9% for the week. The national base hog weighted average price was down 5 cents at $62.29. The USDA estimated weekly FI hog slaughter at 2.417 million head. That is up 28,000 head from the previous week and 101,000 head more than the same time last year.

Cotton futures are trading 8 to 109 points higher this morning, with a bit of a short squeeze in the illiquid March contract, and December holding back after posting new life of contract highs last week. Futures were 15 to 28 points higher on Friday. Exports of upland cotton were down 16.44% from last week at 278,682 RB, which was 12.69% lower than last year. Total upland export commitments through 2/22 were 19.4% larger than last year, slipping some from the previous week. They are now 98% of the USDA full year export projection, above the average of 84% and last year’s 98%. They have to go to 105-110% in most years due to routine deferrals. The marketing year ends July 31 for cotton. The Adjusted World Price or AWP was updated to 73.09 cents/lb on Thursday, up 340 points from the previous week. The Cotlook A index was up 70 points from the previous day on March 1 at 92.40 cents/lb.

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