Good Morning from Allendale, Inc. with the early morning commentary for June 9, 2020.
Grain Markets were mixed with soybean futures slightly higher overnight on strong Chinese demand supporting prices, although improved crop conditions kept a lid on prices. Corn futures eased after climbing to its highest in two months while wheat futures rose for the first time in three sessions.
USDA Weekly Crop Progress Report showed corn planting at 97% complete (97% expected, 93% last week, 78% last year, 94% average). Corn conditions at 75% GTE (75% expected, 74% last week, 59% last year). Soybean planting at 86% complete (87% expected, 75% last week, 54% last year, 79% average). Soybean crop conditions at 72% GTE (71% expected, 70% last week). Hard red Spring wheat planting at 97% complete (96% expected, 96% last week, 96% last year, 99% average). Winter wheat conditions at 51% GTE (50% expected, 51% last week, 64% last year). Cotton planting at 78% complete (66% last week, 74% last year, 81% average). Cotton crop conditions at 43% GTE (44% last week, 44% last year).
USDA Weekly Grain Export Inspections showed corn exports at 1,100,000 tonnes (800,000 to 1,250,000 expected), soybean exports at 433,000 tonnes (400,000 to 625,000 expected) and wheat exports at 213,000 tonnes (350,000 to 600,000 expected).
The U.S. economy ended its longest expansion in history in February and entered recession as a result of the coronavirus pandemic, the private economics research group said. The Business Cycle Dating Committee of the National Bureau of Economic Research said in a statement its members “concluded that the unprecedented magnitude of the decline in employment and production, and its broad reach across the entire economy, warrants the designation of this episode as a recession, even if it turns out to be briefer than earlier contractions.”
The EPA said farmers can use existing supplies of an agricultural weed killer linked to crop damage, after a federal court blocked sales and use of the product last week. The EPA said farmers have until July 31 to use supplies of dicamba-based herbicides that they had on hand as of June 3.
Saudi Arabia will boost output in July to match its output OPEC quota while ending deeper, voluntary cuts amid signs of global demand recovering, the Saudi energy minister said. OPEC, Russia and other producers agreed on Saturday to extend record output cuts of 9.7 million barrels per day (bpd) into July, curbing global supply by almost 10%.
Russian wheat export prices for new crop (due to be harvested over the summer months of June to August) rose last week as the market anticipates dry weather will lead to lower volumes in part of Russia’s south, analysts said. Russia’s southern Stavropol region (one of their main grain producing areas) could see its 2020 crop fall by 40% compared with last year, cited by a regional agriculture ministry.
Cash cattle trade for last week averaged $113.36 using USDA’s 35% – 65% choice metric and $112.39 using their All Grades summary. Last week’s trade range was from $105 to $117.
USDA revised last week’s hog kill down to 2.442 million head (1.3% over last year). Yesterday’s kill run pushed to a new high of 445,000 head, but still below a normal summer weekday of around 488,000.
Dressed beef values were sharply lower again with choice down 6.90 and select down 15.30. The Feeder cattle index is 129.07. Pork cut-out values were down 1.90.