Good Morning from Allendale, Inc. with the early morning commentary for June 26, 2020.
Grain Markets are mixed overnight as traders continue to balance new spikes in COVID-19 cases, world weather forecasts, option expiration, and thoughts on next week’s USDA Grains Stocks and Acreage reports.
Average estimates for next week’s Grain Stocks report has analysts expecting corn stocks of 4.951 billion bushels, soybeans 1.392 bb, and wheat .980 bb.
Acreage numbers are expected to report corn acres at 95.207 million acres, soybeans 84.716 million, and all wheat at 44.718 million. Both reports are due next Tuesday at 11:00 AM CDT.
Corn export sales during this period totaled 538,638 metric tonnes, 461,650 for old and 76,988 for new crop. The old crop sale was a little disappointing at 24% under the five year average for this week. Soybean export sales during this period totaled 1,162,602 metric tonnes, 601,857 for old and 560,745 for new. For old crop, this was the second best sale for this specific week in history. Wheat sales were 518,677 tonnes, all current 2020/21 crop. This was right on the five year average.
Sales to China for the week included 66,149 tonnes of corn, 565,517 tonnes of soybeans, and 4,518 tonnes of pork.
The International Grains Council raised its estimate of 2020/21 world wheat production by 2 million tonnes to 768 million, up from last year’s 762 million. Better crops in Australia and China account for most of the increase.
The European Commission reduced their estimate of EU wheat production to 117.2 million tonnes, down from last month’s 121.5 million. Separately, World Weather, Inc. warns that parts of France and the surrounding region could begin to dry down without more rain added to the forecast.
July grain options go off the board today, First Notice Day is next Tuesday for July Futures, which also happens to be the next big USDA report day.
An effort to legitimize carbon credit markets is gaining momentum in Congress, as lawmakers pitch diversifying income for farmers struggling to make a profit. (Politico)
Cash cattle trades this week from $95 to $98 were a little lower than many expected for this week. Better convergence between cash and June futures than we expected to see.
Beef export sales were great at 24,373 tonnes. This was 61% over last year in the same week. It was also the second best week of the year. Year to date sales come to 528,745 tonnes, 3.8% under last year. Weekly pork export sales ran 24,076 tonnes. That was 19% under last year. Year to date sales of 1,214,493 tonnes are noted, 35% over last year.
Quarterly Hogs and Pigs counted the nation’s hog herd as of June 1 at 5.2% over last year. This was larger than the +3.7% trade estimate. Kept for Marketings as of June 1, hogs set for the packing plant when reaching finishing weight, was 5.8% over last year. That was over the +4.2% trade estimate.
Dressed beef values were lower with choice down 1.43 and select down 1.76. The Feeder cattle index is 129.82. Pork cut-out values were down 2.63.