AgriCharts Market Commentary
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Corn futures settled as much as 4 cents lower in the nearby contracts, with back months fractionally lower. The NWS 8-14 day forecast shows a couple days of drier weather in the Corn Belt following the deluge this weekend. Managed money added another 24,448 contracts to their net short position in the week ending Tuesday April 25. Their reported net position was short 196,257 contracts in corn futures and options, the most bearish in more than a year. The Ag Minister in Brazil, a major importer of US ethanol, is pushing to implement tariffs on the product despite a shortage of domestic ethanol production caused by higher sugar prices.
Soybean futures finished the week fractionally to a penny lower in most contracts. May 17 soy meal was up $1.20, with soy oil down 25 points in the front month. In anticipation of Monday’s Oilseed Crush report, analysts are estimating 162.3 million bushels crushed during the March. Estimates ranged from 161 to 163 million bushels. A Bloomberg poll shows analysts projecting March soy oil stocks at 2.246 billion pounds. In the weekly CFTC Commitment of Traders report, spec funds were reported as adding another 2,447 contracts to their net short position. Their net short position in soybean futures and options was 48,275 contracts as of Tuesday.
Wheat futures were mostly higher on Friday. CHI was fractionally to 5 cents higher, with a 3.33% rise on the week. KC was up 2 1/4 to 4 cents in most contracts, as it was the strongest exchange on the week, 5.01% higher. MPLS was marginally higher in the front months, with the back months up as much as 3 1/2 cents on planting delays. Spec traders held their largest recorded net short position since 2006 on Tuesday at 162,327 contracts in Chicago wheat futures and options. They added 20,201 contracts to their net short position over that week. The forecast for cold temperatures this weekend could have an impact on 20% of the HRW area, according to Commodity Weather Group.
Live cattle futures rose sharply again on Friday, up $1.575 to $2.50. April expired today at $138.00 catching up with cash trade. Over the week June was 6.28% higher, rising 11.86% on the month of April. Feeder Cattle futures finished $2.775 to $4.35 higher, after Thursday’s limit up trade. May feeders were up 7.4% on the week and 12.7% in April. The CME feeder cattle index was at $141.38 on 4/27, up $1.52 from the previous day. Wholesale beef prices were sharply higher in the afternoon report. Choice boxes averaged $221.78, up $2.63, with select gaining $1 with an average price of $207.68. Weekly FI cattle slaughter is estimated at 624,000 head through Saturday, up 29,000 from a week ago and 34,000 head from the same week in 2016. Managed money added another 6,822 contracts to their net long position in cattle futures and options.
Lean hog futures closed the week 22.5 cents to $1.20 higher on most contracts. May was 6.27% higher on the week. The CME Lean Hog Index for 4/26 was down another 22 cents to $59.71.The USDA pork carcass value was up 81 cents in the afternoon FOB Plant report, with an average of $74.46. Only the belly and rib primals were lower. National cash hog base prices averaged 75 cents higher in the afternoon report, with a weighted average of $56.21 and a range reported from $51.00-$59.00. Weekly FI hog slaughter including Saturday is estimated at 2,290,000 head, 3,000 above last week and 154,000 head larger than the same week in 2016. The Commitment of Traders report had spec traders lowering their net long position by 7,523 contracts to only 10,657 contracts in lean hogs options and futures.
Cotton futures posted gains of 91 points in the nearby contracts today, with back months 3 to 32 points higher. The US Dollar was 25 points lower on the session. The US GDP was shown to increase 0.7% in the first quarter, the slowest rate in the last three years. Cotton spec traders added another 13,226 contracts to their net long position in cotton futures and options The new AWP (average world price) is 69.85 cents/lb, up 88 points from the previous week. The Cotlook A index for April 27 was unchanged from the previous day at 88.80 cents/lb. Cash sales on the Seam have been lacking volume this week, as only 166 bales were sold on Thursday at a price of 66.50 cents/lb.