AgriCharts Market Commentary

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Corn

Corn futures are 1 to 2 cents lower this morning, with speculative attention drawn toward the beginning of bitcoin futures trading (+26% at one point overnight!). They saw gains of 1/4 to 1 1/4 cents on Friday, but nearby Dec was 1.38% for the week. The weekly Commitment of Traders report showed spec traders continuing to reduce their net short position by another 36,244 contracts last week. Their CFTC net short position was at -160,519 contracts in corn futures and options as of last Tuesday. Ahead of Tuesday’s USDA supply and demand report, analysts are expecting to see Brazilian production trimmed nearly 1.74 MMT from November to 93.26 MMT. These assumptions are mostly based on lower first crop planted acreage.

Soybeans

Soybean futures are currently 6 cents lower after being 1/2 to 2 3/4 cents lower on Friday. Healthy export sales announcements on Friday were offset by ideas that South American producers could switch corn acres to soybeans. December meal was down $3.50/ton, with nearby bean oil 29 points higher. Soy Meal was up 0.55% with soybeans down 0.45% and bean oil down 0.18%. Managed money added 21,472 contracts to their CFTC net long position in soybean futures and options in the week ending 12/5. That position grew to 53,134 contracts. Safras and Mercado estimate that 26.7% of the 17/18 Brazilian soybean crop is forward sold compared to the average of 33%.

Wheat

Wheat futures are trading 1 to 3 cents lower this morning. They closed the Friday session with most CBT and KC contracts 2-4 cents lower, while a few MPLS contracts were fractionally higher. Nearby Chicago futures lost 5.43% on the week, with Dec KC wheat down 4.7% since last Friday. The Friday Commitment of Traders report showed the spec traders reducing their net short Chicago wheat positions by 3,993 contracts in the week ending last Tuesday. They were net short 118,781 contracts at that time. The Argentine wheat harvest was estimated at 44.7% complete by BAGE on Thursday.

Cattle

Live cattle futures saw most contracts 5 to 47.5 cents lower on Friday, with a couple back months higher. Feeder cattle futures were down 67.5 cents to $1.175 on the day, as Jan feeders lost 3.39% over the week. The CME feeder cattle index on December 7 was down 61 cents to $154.40. Wholesale boxed beef values were higher on Friday afternoon. Choice was up 51 cents at $205.59, with select $2.14 higher at $185.97. Estimated weekly FI cattle slaughter was 633,000 head, 8,000 head fewer than the previous week but 25,000 head larger than the same week last year. Cash trade this week fell $3-4 to $117, as a few sales of $118 were reported earlier in the week. Spec funds in cattle futures and options lowered their net long position by 3,073 contracts to 117,010 contracts as of Tuesday.

Lean Hogs

Lean hog futures ended the week with gains of 10 to 97.5 cents, while Dec fell 2.45% on the week. The CME Lean Hog Index for 12/6 was up 45 cents to $65.30. The USDA pork carcass cutout value was 52 cents higher at $83.70 in the Friday afternoon report. The rib and belly were the only primals lower. The national base hog price was 10 cents lower at $59.10. The USDA weekly FI hog slaughter was 2.537 million head. That was up 2,000 head from the previous week and 89,000 head more than last year.

Cotton

Cotton futures are 34 to 45 points lower this morning. They finished last week with 20 to 51 points losses on Friday. A little pressure came from a stronger US dollar. Managed money spec traders climbed back to their largest net long position since mid May at 82,409 contracts. That was an increase of 11,681 contracts over the week that ended 12/5. The USDA Ag Attach in China expects the country to show 5.4 MMT in 17/18 production, with total usage running at 8.5 MMT. They are also shown as importing 1.3 MMT, an increase of 0.2 MMT from 16/17. The USDA Adjusted World Price (AWP) was updated to 65.03 cents/lb, up 81 points from the previous week. Online cash sales rose to 23,591 bales reported on the Seam, as prices were up 64 points to 69.90 cents/lb. The Cotlook A index was up 25 points from the previous day on December 7 to 83.20 cents/lb.


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