Corn closed the week 3 3⁄4 lower. Private exporters reported sales of 130,000 metic tons to an unknown destination and 120,000 metric tons of corn to Mexico.
Weekly export sales showed a total of 24.2 million bushels with 23.6 million for the 2016-2017 marketing year. This was above the 7.5 million bushels needed this week to be on pace with USDA’s June demand projection of 2.22 billion.
In the weekly crop progress and condition report, the National Agricultural Statistics Service reported conditions at 67 percent good or excellent, in line with expectations and down 1 percent from last week. Last year's the crop was rated 75 percent good or excellent.
Informa updated 2017 acreage with corn at 90.18 million acres, up 190,000 from March.
Ethanol production has fallen below last year’s same-week rate in each of the last two weeks. Production for the week ending June 9 totaled 1.002 million barrels per day, which was 1.1 percent below last year’s 1.013 million barrels per day. It followed last week’s production being down 0.7 percent.
There is still time for a weather market to develop, but good rains in the eastern cornbelt leaves the western belt as the lone dry area remaining. Corn is pollinating in Missouri, and rains will help the crop reach full yield potential.
Strategy and outlook: Look to make sales and lock in prices during rallies over the next four weeks.
Soybeans closed the week 1⁄4 cents lower. Private exporters did not report any private sales.
Weekly export sales showed a total 24 million bushels with 12.5 million for the 2016-2017 marketing year. This raised total sales to 2.16 billion bushels, 6 percent above USDA’s June demand projection of 2.05 billion.
The weekly crop progress report included the first soybean crop conditions of the year, which were 66 percent good or excellent, lower than 69 percent expected and well below last year’s 74 percent rating. This is the lowest conditions in four years for mid-June.
Soybean planting is 92 percent complete, now ahead of last year’s 91 percent rate.
Informa updated acreages with soybean at 89.362 million acres, up 120,000 from the March estimate.
The National Oilseed Processors Association crush report placed May crush at 149.2 million bushels, about 6 million bushels higher than average trade estimates for the month that called for 143 million. This was one of the largest crush figures for the month of May and rebounded from a crush of 139.13 million in April.
May soy oil stocks were reported at 1,749 billion pounds, up 24 million from the association’s last report.
Strategy and outlook: Producers need to make new crop sales on rallies during the next four weeks as large supplies of product will be hitting the market from not only the U.S. but also from South America.
Chicago wheat closed 19 3⁄4 cents higher, Kansas City wheat closed 22 cents higher, and Minneapolis 33 1⁄2 cents higher. Private exporters did not announce any sales.
Weekly export sales for all wheat showed a total of 13.7 million bushels, all for the 2017-2018 marketing year. This was slightly below the 14.6 million needed in this week’s report to be on pace with USDA’s June demand projection of 1 billion bushels.
In the weekly crop progress report, winter wheat crop conditions are 50 percent good or excellent versus 49 percent expected, up 1 percent from last week. The winter wheat crop remains well below last year’s rating of 61 percent good or excellent.
Winter wheat harvest advanced to 17 percent complete, slightly below expectations of 22 percent but up from 10 last week. Last year, only 10 percent of the crop was harvested at this time, and normally only 15 percent is harvested.
In a big surprise, spring wheat crop conditions were revealed at only 45 percent good or excellent, well below expectations of 53 percent and down 10 points from last week. About 79 percent of the spring wheat crop was rated good or excellent last year. This is the lowest rated crop since 1992 when 43 percent of the crop was rated good or excellent.
Only 13 percent of the South Dakota crop is rated favorably. North Dakota, the largest spring wheat producing state has 43 percent rated well, and Montana is only rated 23 percent good or excellent.
Informa updated 2017 acreage with spring wheat at 11.19 million acres, down 110,000 acres from March.
Strategy and outlook: Look to make sales and lock in prices during rallies over the next six weeks.
Live cattle closed $5.92 lower while feeder cattle closed $6.30 lower. Fed cattle trade in the South was established from $127 to $132 this week, $4 to $8 lower compared to last week.
The majority of trade, however, did occur between $130 and $132 this week. Trade in the North was established from $128 to $133 this week, $5 to $8 lower compared to last week. Dressed trade in the North occurred from $206 to $215, $5 to $12 lower compared to the week prior. Last week’s Fed Cattle Exchange was not held due to technical issues.
USDA steer carcass weights moved 9 pounds higher to 847 pounds and are now 17 pounds below a year ago weights of 859 pounds. If weights to continue to increase, third quarter production is expected to swell.
The USDA Foreign Agricultural Service’s weekly beef exports were 14,502 metric tons, up 9.3 percent from a year ago. Weekly beef exports are now up 16 percent year to date versus 2016. April beef exports were 218.3 million pounds, down from March exports of 234 million pounds. Year to date exports are up 189.1 million compared to a year ago.
Strategy and outlook: Producers with cattle to market this summer and fall should be transferring risk with put options. Feed costs should be locked in for the entire year.
Lean hogs closed the week $3 lower. Pork exports were 21,007 metric tons, down 1 percent from a year ago and now up 14 percent year to date.
Weekly hog weights were 279.4 pounds, down 1.8 pounds from the prior week and are 2.5 pound below last year.
April pork exports were 462.9 million pounds, down from the March export pace of 523.8 million pounds.
Strategy and outlook: Producers should have hedged 2017 production as prices tested weekly chart resistance. The 2017 feed costs should be locked in for the entire year.
Brian Hoops is president and senior market analyst of Midwest Market Solutions Inc., based in Springfield, Mo., with branch offices in Thief River Falls, Minn.; Verona, N.D.; Yankton, S.D.; Storm Lake, Iowa; and Springfield, Neb. Hoops can be reached at 417-501-5132.