Good Morning from Allendale, Inc. with the early morning commentary for April 7, 2020.
Grain Markets are mixed with corn and soybean futures higher as energy prices find strength. Wheat is lower as traders continue to gauge demand in the face of coronavirus.
USDA Monthly Supply and Demand report estimates show U.S. corn ending stocks at an average of 2,004 million bushels (1.892 million bushels last report), U.S. soybean ending stocks at 430 million bushels (425 million bushels last report), and U.S. wheat ending stocks at 940 million bushels (940 million bushels last report).
USDA World Crop Ending Stocks estimates show world corn ending stocks at an average of 298.50 million tonnes (297.34 million tonnes last report), world soybean ending stocks at 101.10 million tonnes (102.44 million tonnes last report), and world wheat ending stocks at 287.37 million tonnes (287.14 million tonnes last report).
USDA Weekly Crop Progress report was released showing Winter wheat conditions at 62% GTE (56% GTE expected, 60% GTE last year), cotton planting at 7% complete (5% last year, 5% 5-year average, oats planting at 26% complete (29% average) and sorghum at 15% planted (13% 5-year average). The USDA’s first corn and Spring wheat planting progress data of the year is expected to be released in next week’s update.
USDA Weekly Grain Export Inspection report showed corn export sales at 1,271,000 tonnes (expected between 800,000 and 1,200,000), soybean export sales at 298,000 (expected between 300,000 and 650,000) and wheat exports at 320,000 (expected between 300,000 and 550,000).
China’s embassy in Brazil responded with outrage to a social media post by Brazil’s Education Minister Abraham Weintraub that appeared to mock Chinese accents while insinuating the Chinese stood to benefit from the coronavirus pandemic, apparently reigniting a smoldering diplomatic row between Brazil and its largest trading partner. The Chinese embassy described the post as “defamatory,” “stigmatizing,” “completely absurd and despicable,” and “having a strongly racist manner.” (Reuters)
Major oil producers including Saudi Arabia and Russia are likely to agree to cut production at this Thursday’s meeting but only if the U.S. joins the effort to cope with the disastrous effect of the coronavirus on fuel demand, three OPEC+ sources said. The U.S. has not committed to taking part in any deal, which President Trump has said could take 10% to 15% of world supply off the market. (Reuters)
Choice beef prices lost $22.40 last week, yesterday morning’s run saw -0.70. The USDA cattle kill estimate was lower than expected at 110,000 head (normal run around 121,000 head). Today CME live cattle futures will remain at expanded daily limits of $4.50
Wholesale pork prices fell 16.42/cwt. last week, yesterday morning’s run saw +2.01. The USDA hog kill estimate was lower than expected at 477,000 head (normal run around 492,000 head). Today CME lean hog futures will return to the normal $3.00 daily limit.
Dressed beef values were lower with choice down 0.39 and select down 0.81. The Feeder cattle index is 119.38. Pork cut-out values were down 0.32.