Good Morning from Allendale, Inc. with the early morning commentary for June 29, 2020.
Grain Markets were mixed overnight with corn futures edging higher after five consecutive sessions lower while soybean and wheat futures pulled back on weather conditions. Forecasters expect favorable rains across the heart of the Midwest farm belt through the start of this week, which should limit the stress on crops when above-normal temperatures move into the region later in the week.
Last week, September corn futures were down 19 cents, August soybeans were down 15.50 cents, September wheat down 9.50 cents, September soymeal was down 3.80 and September soyoil was down 109 points.
USDA Weekly Crop Progress Report will be released this afternoon at 3 p.m. CDT. Trade is expecting corn crop conditions to rise to 73% GTE (72% last week, 68% average). Soybean crop conditions expected increase to 71% GTE (70% last week, 66% average). Hard red Spring wheat crop conditions expected stay near 75% GTE (81% last week, 69% five-year average). Winter wheat harvest expected to advance to 40% complete (28% last year, 47% average).
Average estimates for tomorrow’s Grain Stocks report has analysts expecting corn stocks of 4.951 billion bushels, soybeans 1.392 bb, and wheat .980 bb.
Acreage numbers are expected to report corn acres at 95.207 million acres, soybeans 84.716 million, and all wheat at 44.718 million. Both reports are due tomorrow morning at 11:00 AM CDT.
CFTC Commitments of Traders report showed funds new net position short -277,479 corn contracts, long +44,285 soybean contracts, short -48,213 wheat contracts, long +17,567 live cattle contracts and long +8,989 lean hog contracts.
July grain futures will have First Notice Day tomorrow. July grain options came off the board on Friday of last week.
Last week’s cattle processing totaled 680,000 head (668,000 estimated) but was over the previous week’s 656,000. Last week’s run (at +1.4% year/year) was the first weekly run over last year’s kill in 12 weeks. Cattle are not yet into the backlog though as the natural supply is roughly 3% over last year.
Pork processors are covering the natural flow of finished hogs (+4%) plus eating into some of the backlog. Two weeks ago, they drew it down by 44,000 and last week by 170,000 head. Allendale estimates there is under 1.9 million head backlog remaining.
Dressed beef values were lower with choice down 1.09 and select down 1.08. The Feeder cattle index is 130.04. Pork cut-out values were up 0.90.