Corn closed the week 1 cent higher. Private exporters announced sales of 200,000 metric tons (mts) of corn to Mexico.
In the weekly export inspections report, corn inspections totaled 9.2 million bushels (mb) for the week ending Sept. 19, below the 40.3 mb needed each week to reach USDA's export estimate of 2.050 billion bushels (bb). Inspections for 2019-20 now total only 44 mb, down 63% from the previous year.
In the weekly crop progress and conditions report, corn was rated at 57% good or excellent, up 2% from last week's rating but still below last year's 69% rating. Just 7% of the corn crop has been harvested, slightly behind the average pace of 11% with 29% rated mature versus 57% average.
In the month of October, harvest will ramp up across the cornbelt and the market will become very sensitive to any yield reports. The market has already factored in sizeable yields so a cut in production, would be bullish for prices. Large carryover stocks and poor demand provide a cushion to lower yields.
Strategy and outlook: A bullish technical weekly reversal suggests the lows are in for the fall.
Soybeans closed the week ¾ of a cent higher. Private exporters announced sales totaling 964,000 mts of soybeans to China.
In the weekly export inspections report, soybean conditions were 54% good or excellent, unchanged from last week and below last year's 68% rating. 34% of the soybean crop is dropping leaves versus the average of 59%.
In the weekly crop progress report, U.S. soybean inspections totaled 33.9 mb for the same week, below the 34.6 mb needed weekly to reach USDA's export estimate of 1.775 bb. Inspections for 2019-20 now total 80 mb, down 8% from the previous year.
Harvest activity should pick up in October and the market will become very sensitive to yield reports. Demand is improving and if an agreement with China is reached, values are well undervalued given the demand prospects. Commercials have moved to a bearish COT position.
Strategy and outlook: October meetings would be the perfect time for the U.S. and China to reach a trade agreement. A bullish technical weekly reversal suggests the lows are in for the fall.
Chicago wheat closed 2 and ¼ cents cent higher; Kansas City wheat closed unchanged and Minneapolis wheat 22 and ¾ cents higher. Egypt bought 240,000 mts of Russian wheat and 60,000 mts of French wheat.
In the weekly export inspections report, spring wheat harvest remains behind normal at 87% complete versus 97% on average. Winter wheat seeding is now 22% complete versus 24% on average. Cotton harvest advanced to 11% complete and conditions are 39% good or excellent versus 41% last week and 39% last year. Oat harvest advanced to 96% complete.
In the weekly export inspections report, wheat inspections totaled 17.5 mb for the same week, below the 18.9 mb needed weekly to reach USDA's export estimate of 975 mb. Inspections for 2019-20 now total 294.2 mb, up 22% from the previous year.
Winter wheat seedings are off to a solid start across the winter wheat plains, however the remains harvest of the spring wheat crop has been slowed due to excessive moisture.
Strategy and outlook: The huge world supplies of wheat mandates producers to sell out inventory and use options to manage risks on sharp rally attempts.
Last week, live cattle closed $5 higher while feeder cattle closed $5.22 higher. Fed cattle trade in the North was $104 to mostly $106 to $107 live and $165 dressed - $2 to $5 higher than the week prior. Trade in the South was primarily $103 - $2 higher versus the week prior.
The Fed Cattle Exchange saw 1,533 head offered for sale in 7 lots. All lots went unsold. The lots asked $103.50 to $104. The latest USDA steer carcass weights were down 2 pounds compared to the prior week at 891, making them 5 pounds less than last year. Net beef sales of 19,100 metric tons (MT) reported for 2019 were up 15% from the previous week and from the prior four-week average.
Strategy and outlook: Re-opening the Holcolmb, Kansas plant sooner than expected would be a bullish development for the cash markets.
Lean hogs closed the week $3.52 higher. Iowa and Minnesota weekly hog weights came in at 280.5 pounds versus 281.3 pounds week prior and 278.5 pounds last year. Net pork sales of 32,200 MT reported for 2019 were up noticeably from the previous week and 57 percent from the prior four-week average.
The Quarterly Hogs and Pigs report came out on Friday afternoon and is bearish compared to trade estimates. All hogs and pigs were above the average trade guess at 103.4% of last year and 77.678 million head versus 75.136 million a year ago. This is the largest September amount on record and the highest overall since 1943.
Kept for breeding came in at 101.6% versus 101.4% estimated and kept for marketing was 103.5% versus estimates of 103.1%.
Strategy and outlook: Producers should have moved all risk to the cash markets.