Export Demand in Focus Today

Good Morning from Allendale, Inc. with the early morning commentary for November 13, 2020.

Grain Markets are mixed after a strong USDA data led rally this week. With the WASDE report now behind us and U.S. harvest near complete, traders are analyzing price potential with weather, virus cases, and Chinese demand in mind.

Weekly export sales will be released this morning, one day late due to Wednesday’s holiday. Traders expect to see corn sales of 700,000 to 1,600,000 tonnes, soybeans 800,000 to 1,800,000 tonnes, and wheat 200,000 to 700,000.

NOPA Crush is set to be released on Monday at 11:00 AM CST. Traders expect to see 177.123 million bushels of soybeans were crushed in October. If realized, this would be the second highest month on record and up 9.7% from September.

Ethanol production in the latest week advanced to 977,000 barrels per day. That was an improvement over the 961,000 the prior week.

Rain in South America remains a concern. World Weather, Inc. stated, “Despite computer forecast models painting nice pictures of precipitation across much of Brazil and in portions of western Argentina, a very large part of South America has not seen “normal” precipitation over the past six weeks.”

The Rosario Grains Exchange lowered its wheat production estimate for Argentina from 17.0 to 16.7 mt. In previous days the Buenos Aires Grains Exchange suggested 16.8.

Interfax news agency reports it has seen a document detailing the planned limits on Russian wheat exports. From February 15 – June 30 the country plans to limit exports to 15 million tonnes.

Five grain ships that are being delayed by this week’s general port worker in strike in Argentina, however, we do not see this as a market moving issue at this time.

The Fed Cattle Exchange held a second auction yesterday. This comes after Wednesday’s attempt saw good packer interest but no confirmed sales. Yesterday’s offering held six lots. Two of those sold at $110, one at $110.75 and one at $111.

Weekly Actual Slaughter report from USDA today revised meat production from two weeks ago. In the week of 10/31 steer carcass weights fell 5 lbs. from the prior week to now 926 lbs. Heifer weights rose by 1 in this week to 848.Barrows and gilts were unchanged from the previous week at 215 lbs.

February is officially the lead lean hog contract right now. It has the larger open interest. Volume will roll into it shortly.

Dressed beef values were mixed with choice up 3.66 and select down 0.22.  The Feeder cattle index is 136.70.  Pork cut-out values were down 0.06.

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