Good Morning from Allendale, Inc. with the early morning commentary for December 28, 2020.
Grain Markets pushed higher as South American crop supply struggles continue with lower than expected production in Argentina and Brazil topped with an Argentine port strike that continues as both sides can not agree on mutual terms. Traders will be watching progress in South America as well as tomorrow’s Argentine union meeting.
Last week, March corn futures were up 13.00 cents, March soybeans were up 40.75 cents, March wheat up 19.50 cents, March soymeal was up $8.60 and March soyoil was up 142 points.
CFTC Commitments of Traders report was delayed due to Christmas holiday and will be released today.
Corn export sales last week came in at 651,102 metric tonnes (42% under the five year average). To hit USDA’s current shipment goal the U.S. will only need 923 million bushels of sales (11% under the five year average). Soybean export sales were at 517,784 metric tonnes (78% under the five year average). To reach USDA’s shipment goal, the U.S. will 257 million bushels of sales from now until August 31st.
Argentine port workers rejected the latest offer from crushers/exporters. Unions elected to spend Christmas on strike, which started on Dec. 3rd and has 170 cargo ships waiting to load ag commodities. The next meeting is tomorrow (12/29).
BAGE last week trimmed Argentine corn rating 4% to 20% GTE (61% planted). Soybean ratings were cut 1% to 49% GTE (77% planted).
Future hog production (based on last week’s Hogs & Pigs report) will be larger than expected for the second half of 2021. December – February farrowing intentions were noted at 101.6% of last year (estimated 98.3% of last year).
February lean hog futures finished the week up $1.15. April lean hog futures also finished the week up $1.15 and gains were capped by Thursday’s disappointing Hogs & Pigs report.
February live cattle futures finished the week up $0.12. Cash cattle traded at $110 last week (up from $106 the previous week and $108 peak).
Dressed beef values finished lower on Thursday with choice down 3.13 and select down 1.66. The Feeder cattle index is 139.82. Pork cut-out values were up 1.18. There were no wholesale beef & pork reports on Friday due to the holiday.