August 26, 2019

Argentina to Plant Fewer Soybeans

Good Morning! From Allendale, Inc. with the early morning commentary for October 20, 2017.

Grain markets continue to monitor harvest results as extended weather forecasts look to get colder in the US Midwest. We hope you'll consider listening in to our webinar Tuesday night next week - see details below.

La Nina is looking more and more likely in the coming months. How is this impacting the agriculture markets? What should we expect going forward? We'll discuss this and so much more with CME Group's Erik Norland, October 24th at 8:00 PM CDT. Register here to join us or to have the recording sent to you.

Weekly export sales for the week of October 5 - 12 had corn sales totaling 1,269,868 metric tonnes (15,000 2018/19). That was over the 800,000 - 1,100,000 trade estimate. USDA's current 1.850 billion bushel goal for whole-year corn exports would be 6% over the five year average. Current sales are 5% under the five year average at 588 million bushels.

Soybean export sales were reported at 1,275,154 tonnes (all 2017/18). That was under the 1,300,000 - 1,700,000 trade estimate. USDA's current whole-year goal for exports this year is for a record 2.250 billion bushels. That would be 26% over the five year average. Year to date sales only come to 966 million bushels at this point, 4% under the five year average.

Wheat export sales totaled 615,432 tonnes (all 2017/18). That a bit over the 250,000 - 450,000 trade expectation. The current USDA goal of 975 million bushels would be about right on the average of the past five years.

Informa lowered its estimate of U.S. 2018 corn plantings to 90.460 million acres, from its 91.880 previous estimate. They raised U.S. 2018 soybean plantings to 90.347 million acres, up from last months 89.057 million acres.

Argentine farmers are expected to increase their corn planting by 5.2% in the 2017/18 growing year according to government data. This comes as the Argentine government encourages crop rotation by eliminating export controls and a 20% tax on corn exports. Some analysts believe the Argentine soy crop will drop by 7%.

US Ag Attache to Australia has lowered its Australian wheat production estimate to 20 million MT for the 2017/18 crop. This is down sharply from the 16/17 crop of 35 million MT. Poor weather is to blame for the decrease.

22 members of the U.S. House of Representatives asked the Environmental Protection Agency in a letter on Thursday not to lower some requirements for mixing biofuels into the country's fuel supply, but also not to let ethanol exports qualify for renewable fuel credits. The members of Congress are part of a bipartisan voting bloc dedicated to supporting the biofuels industry called the House Biofuels Caucus. (Reuters)

Managed money funds were estimated buyers of 1,000 corn contracts, 4,500 soybeans, 2,500 wheat, and 4,000 soyoil in yesterday's trade. They were sellers of 1,500 soymeal.

Existing home sales will round up this week of important economic data. The report is due today at 9:00 AM CDT.

China's pig herd fell to 427.97 million during January to September, down 0.8 percent from the same period a year ago, while pork output rose 0.7 percent to 37.17 million tonnes, data from the National Bureau of Statistics showed on Thursday.

Cattle-On-Feed report will be released today at 2:00 PM CDT. Reuters survey of analysts show average estimates for On Feed October 1, 2017 is 104.6%, Placements during September 108.0% and Marketing in September 102.6%.

Dressed beef values were higher with choice up 2.31 and select up 1.67. The CME Feeder Index is 155.08. Pork cutout value is up .44.

Technical Chart of the Day

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