USDA Shows Plantings Below Expectations 

Good Morning from Allendale, Inc. with the early morning commentary for May 19, 2020.

Grain Markets pulled back slightly after two days of gains, but losses were limited due to strong Chinese demand and lower than expected U.S. planting numbers.  Traders will continue to watch the weather maps and planting progress after heavy storms hit most of the growing areas over the weekend.

USDA Weekly Crop Progress Report showed corn planting at 80% complete (81% expected, 67% last week, 44% last year, 71% average).  Soybean planting at 53% complete (56% expected, 38% last week, 16% last year, 38% average).  Hard red Spring wheat planting at 60% complete (60% expected, 42% last week, 63% last year, 80% average).  Winter wheat conditions at 52% GTE (53% expected, 53% last week, 66% last year).  Cotton planting at 44% complete (32% last week, 39% last year, 40% average).  

USDA weekly grain export inspections showed corn exports at 1,151,000 tonnes (800,000 to 1,300,000 expected), soybean exports at 352,000 tonnes (300,000 to 650,000 expected) and wheat exports at 441,000 tonnes (300,000 to 600,000 expected).

China escalated tensions with Australia by announcing anti-dumping and anti-subsidy duties totaling 80.5% on Australian barley imports starting May 19, which is expected to halt a billion-dollar trade between them.  China’s Ministry of Commerce said it had confirmed dumping by Australia and significant damage on its domestic industry as a result, following an inquiry which began in 2018.  The tariffs on barley, will remain in place for five years.

New Hope Group, one of China’s largest pig breeders, expects the country’s hog output to recover from last year’s disease epidemic by 2021, while prices will start to fall after a rush of new entrants into pig farming, chairman Liu Yonghao said.  Liu said prices for pork, China’s favorite meat, will remain relatively high this year, but could fall below production costs in the coming years as new players, including real estate and internet companies, turn to farming. (Reuters)

USDA Cold Storage report will be released this Thursday at 2 p.m. CDT.  Allendale sees end of April pork stocks at 604.588 million lbs. (17 million lbs. less than last month).  The five-year average for April is a 12 million lb. increase.

Allendale estimates Thursday’s Cold Storage report for beef around 469.277 million lbs. (33 million under last month). The five-year average is a 6 million lbs. decline.

USDA Cattle on Feed Report (end of April) will be released this Friday at 2 p.m.  Allendale sees feedlot placements at 13.3% under last year. This is after seeing -22.7% under last year in March and -7.6% year/year in February.  With packers still down last month, Allendale estimates marketings at 15.3% under last year and May 1 Cattle on Feed at 4.9% under last year.

Choice beef prices peaked last Tuesday at $475.39/cwt. By the end of last week, prices had already taken off $41.07.  Choice took off another $19.37 on yesterday’s afternoon report as well with values at $414.95.

Dressed beef values were lower with choice down 19.37 and select down 24.19.  The Feeder cattle index is 125.73.  Pork cut-out values were down 2.66.

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