Traders Turn to USDA

Good Morning from Allendale, Inc. with the early morning commentary for April 9, 2020.

Grain Markets are higher as traders look to the latest in USDA Supply and Demand numbers amid an ever-changing coronavirus situation. As a reminder, markets will close at their normal time today, but will not reopen until Sunday night in observance of Good Friday.

USDA 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). This report will be released today at 11 a.m. CST.

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).

Weekly export sales will be released this morning and are expected to show corn sales between 1,200,000 and 1,900,000 tonnes, soybeans 700,000 and 1,400,000, and wheat 200,000 and 550,000.

Another sharp decline in ethanol production was noted last week. 672,000 barrels per day was noted, down from 840,000 the prior week. The week before production was still strong at 1.005 million bpd. This week’s pace was weaker than we expected at 33% under last year. The prior week was down 16%.

World Weather, Inc has their eye on crops in Europe, stating, “Drier biased conditions combined with warmer than usual conditions over the coming week will help to induce more aggressive drying across Europe for the next seven to ten days. Dryness will intensify and spread not only in the Balkan Countries, but in Germany and France as well.”

A drop in the water level of Argentina’s Parana River has forced agro-export companies to load less merchandise on ships, the local ports chamber said on Wednesday, adding a new problem to a sector beset by bottlenecks due to the coronavirus outbreak. (Reuters)

OPEC and allied oil producers are expected to hold a virtual meeting at 9:00 AM CST today to make a decision on global crude production that could make or break the oil market.

$105 cash cattle was traded again yesterday with limited volume in the country and in eight lots on the Fed Cattle Exchange.

There is one week left for the April contract to trade. The LHI through Tuesday’s cash hog trade is 52.97. April futures are at 43.12.

So far the fears about hog weights are not yet showing in the numbers. The weekly Iowa/Southern Minnesota report as of 4/4 showed a -0.4% year/year drop. That is down from previous week of -0.2%.

Dressed beef values were lower with choice down 5.54 and select down 5.98. The Feeder cattle index is 116.79. Pork cut-out values were down 3.32.

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