Ag Market Commentary

Corn futures closed 1 to 2 cents higher on the first trading session of the new year. The USDA weekly Export Inspections report showed very typical holiday week shipping of 683,898 MT. Last year it was 638,577 MT for the same week. Soil moisture is expected to decline in southern Brazil, Argentina and Uruguay over the next week, driven by higher temps and limited rainfall during pollination. The EU Commission increased corn production estimate to 64.6 MMT from 62.2 MMT. The afternoon USDA CAIR Grain Crush report showed 525 million bushels of corn used for ethanol and other industrial uses in November. Of that, 475.7 million went to fuel ethanol production, which was up 1.2% from October and up 5.2% from November 2016.

Mar 18 Corn closed at $3.53 1/4, up 2 1/2 cents,

May 18 Corn closed at $3.61 1/4, up 2 1/4 cents,

Jul 18 Corn closed at $3.69 3/4, up 2 1/2 cents

Sep 18 Corn closed at $3.77 1/4, up 2 1/2 cents

Soybean futures firmed later in the day and settled 2 to 6 cents higher. Meal futures were up 90 cents/ton. Soy oil got a lift from higher palm oil trade in Malaysia and closed 30 points higher. The USDA weekly Export Inspections report this morning showed 1.139 MMT shipped in the week ending December 28. That was down 11% from the previous week and lagged the same week in 2016 by 28%. USDA’s Fats & Oils report was expected to show November crush of about 174 million bushels. The trade guess was very close, with the actual number at 173.33 million bushels. Soy oil stocks were 1.379 billion pounds.

Jan 18 Soybeans closed at $9.55, up 3 1/4 cents,

Mar 18 Soybeans closed at $9.64 3/4, up 3 cents,

May 18 Soybeans closed at $9.75 3/4, up 2 3/4 cents,

Jul 18 Soybeans closed at $9.86, up 2 3/4 cents,

Jan 18 Soybean Meal closed at $313.50, up $0.90,

Jan 18 Soybean Oil closed at $33.38, up $0.30

Wheat futures were higher in all three markets, with KC HRW up 5 to 7 cents. Chicago SRW was up 6 to 7 cents and MPLS spring wheat advanced 3 to 3 cents. This morning, USDA indicated wheat export loadings totaled a paltry 274,506 MT last week. That was down 32% from the same week in 2016. Shipments since June 1 are 37 million bushels smaller than last year. The EU Commission today cut projected 2017/18 EU wheat exports from 27 MMT to 26 MMT, while also trimming their estimate of last year’s production by 500,000 MT.

Mar 18 CBOT Wheat closed at $4.33 1/2, up 6 1/2 cents,

Mar 18 KCBT Wheat closed at $4.34 3/4, up 7 1/2 cents,

Mar 18 MGEX Wheat closed at $6.18, up 3 1/4 cents

Live cattle futures posted triple digit gains, up $1.42 to $1.92. Feeder futures had more dramatic numbers, up $2.07 to $4.20 per hundred. Feedlots succeeded in extracting higher cash prices on Friday, with $123 reported in the south and $195 in the north. High wind chill readings are limiting ability to move cattle in some areas, but that should abate by mid-week. Rates of gain may also be slowed by the cold temps. The CME feeder cattle index on December 29 was $156.02, up a sharp $9.51 from the previous day. Wholesale boxed beef values were sharply higher today as retailers got away from the turkeys and hams and planned some beef features. Choice boxes were on average $2.24 higher than Friday, with Select boxes up $3.59 per cwt. The choice/select spread is tightening seasonally and is down to $8.57. Estimated week to date FI cattle slaughter is 116,000 head. That is 3,000 head more than last week, but 14,000 fewer than the same week last year due to smaller numbers on both Monday and Tuesday.

Feb 18 Cattle closed at $123.350, up $1.800,

Apr 18 Cattle closed at $124.100, up $1.675,

Jun 18 Cattle closed at $115.175, up $1.525,

Jan 18 Feeder Cattle closed at $149.525, up $3.525

Mar 18 Feeder Cattle closed at $146.875, up $4.200

Apr 18 Feeder Cattle closed at $146.925, up $3.850

Lean hog futures ended the day mixed, with the front contracts lower but summer futures in the plus column. Nearby February was down $1.05 but at $70.72 still maintained a $10 premium to the Index. The CME Lean Hog Index for 12/28 was up 14 cents at $61.72. The USDA pork carcass cutout value was down 11 cents in the PF report at $78.33. Pork bellies were up sharply $(4.92). The national base hog weighted average price was up 28 cents to $59.02. The IA/MN region was up 24 cents at a weighted $59.43. The USDA week to date FI hog slaughter was estimated at 460,000 million head. That is up 103,000 head from last week and 11,000 larger than the same week last year. Last week’s estimate was trimmed 5,000 head to put it at 2.102 million for the week.

Feb 18 Hogs closed at $70.725, down $1.050,

Apr 18 Hogs closed at $74.850, down $0.800

May 18 Hogs closed at $79.800, down $0.200

Cotton futures posted triple digit losses on Tuesday. Asset allocation models pared down positions in some of last year’s winners, which included cotton. The dollar was still down hard and supporting export potential by trading at the lowest level since September. The USDA Adjusted World Price (AWP) was increased 262 points to 70.62 cents/lb on Thursday. The Cotlook A Index for the 29th was UNCH at 89.60.

Mar 18 Cotton closed at 77.500, down 113 points,

May 18 Cotton closed at 77.770, down 119 points

Jul 18 Cotton closed at 78.140, down 110 points

Market Commentary provided by:

Brugler Marketing & Management LLC
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