AgriCharts Market Commentary

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Corn

Corn futures closed around a penny higher on Friday, with Dec16 corn settling at $3.41 3/4. However, front month Sep16 corn was still down 17 1/4 cents on the week. Managed money held a net short CFTC position of 13,362 contracts as of the close on Tuesday, July 19. The group held a net long position of 8,702 contracts as of July 12. This was the first net short CFTC position held by the group since April 19 when they were still net short more than 30,000 contracts. During Friday’s auctions in China, 453,203 MT of the country’s reserve stocks were sold. Corn harvest in Argentina is estimated to be 53% complete. The Ag Ministry there expects 2015/16 production to reach 39.8 MMT, up from their previous estimate of 37.9 MMT, and significantly higher than the current USDA estimate of 28 MMT. The Argentinean estimate includes silage.

Sep 16 Corn settled at $3.35, up 3/4 cent,

Dec 16 Corn settled at $3.41 3/4, up 1 cent,

Mar 17 Corn settled at $3.51 1/2, up 1 1/4 cents

May 17 Corn settled at $3.57, up 1 cent

Soybeans

Soybean futures incurred sharp losses on Friday, led by a 26 3/4 cent decline in the Sep16 contract. However, that contract was able to close 21 1/2 cents above its intraday low. Cooler mid-range forecast models with normal precipitation (and momentum) drove the soy complex lower during the session. Aug16 beans were down 66 cents on the week. Aug16 meal and oil were down $22.70 and $0.68 on the week respectively. Managed money held a net long CFTC position of 137,692 contracts as of the close on Tuesday. This was a week over week reduction to the net long position of 21,715 contracts. Chinese auctions sold 332,039 MT of 2012 reserve soybean stocks on Friday, only 57% of the total stocks offered. The Argentinean trucker strike has been lifted. The 2015/16 Argentinean soybean production was estimated to be 58.8 MMT by the local Ag Ministry this morning, up 0.8 MMT from its previous estimate, and larger than the 56.5 MMT estimate released by the USDA.

Aug 16 Soybeans settled at $10.06 1/2, down 26 cents,

Sep 16 Soybeans settled at $9.98 3/4, down 26 3/4 cents,

Nov 16 Soybeans settled at $9.88 1/4, down 24 1/4 cents,

Jan 17 Soybeans settled at $9.89 1/4, down 23 1/2 cents,

Aug 16 Soybean Meal settled at $346.70, down $5.80,

Aug 16 Soybean Oil settled at $30.21, down $0.85

Wheat

Wheat futures finished with 7 to 10 3/4 cent gains in CHI and MPLS on Friday, and up 11 1/2 to 12 1/2 cents in KC. Prices were boosted due in part to concerns of the French wheat crop, as FranceAgriMer stated that only 42% of the unharvested French wheat crop was in good to excellent condition as of Monday. This was a 7 point week over week decline, and down from 76% at the same time last year. For the week, the front month SRW and HRW contracts were up 1/2 cent and 5 1/4 cents respectively. However, Sep16 HRS was down 1 1/2 cents from last Friday. This afternoon’s CFTC report showed that managed money held a net short position of 116,606 contracts in CHI as of Tuesday’s close, and a net short position of 19,906 contracts in KC. From Tuesday to Tuesday, the net short positions grew by 1,938 and 1,189 contracts respectively. Ukrainian wheat exports in 2016/17 are expected by UkrAgroConsult to fall to 13 MMT from the 2015/16 USDA figure of 17 MMT. The current USDA estimate for 2016/17 is 12.5 MMT. Russian wheat production is projected to reach 68 MMT this year by IKAR, up from their previous estimate of 66 MMT, and from the July USDA estimate of 65 MMT.

Sep 16 CBOT Wheat settled at $4.25 1/4, up 7 1/2 cents,

Sep 16 KCBT Wheat settled at $4.19, up 11 1/2 cents,

Dec 16 MGEX Wheat settled at $5.11, up 8 3/4 cents

Cattle

Live cattle futures posted gains of $1.925 to $2.425 on Friday, but front month Aug16 cattle were still down 97.5 cents on the week. Feeder futures closed up as much as $2.80. However, Aug16 feeders were still down $2.38 on the week. The CME Feeder Cattle Index for 7/21 was down $1.01 to $139.22. The monthly Cattle on Feed report this afternoon showed July 1 cattle on feed 101.17% of a year ago, below the average pre-report estimate of 101.6%. June placements were pegged at 102.97% of a year ago and marketings at 109.44%. Cash cattle trade recorded a few live sales from $113 to $115 on Friday, and dressed sales of 65 to 80% choice beef from $180 to $182. The average price of choice boxed beef was 61 cents lower on Friday to $200.09 (-$4.26 Fri to Fri), and select prices were a quarter lower at $189.57 (-$2.81 Fri to Fri). Including Saturday estimates, FI cattle slaughter was estimated at 595,000 head, down 3,000 head from last week, but 60,000 head larger than the same week in 2015. The USDA Cold Storage report this afternoon showed 451.233 million pounds of beef was in refrigerated warehouses as of June 30, up 1.2% from May, but down 5% from June 2015.

Aug 16 Cattle settled at $109.950, up $2.425,

Oct 16 Cattle settled at $108.075, up $2.375,

Dec 16 Cattle settled at $109.200, up $1.925,

Aug 16 Feeder Cattle settled at $137.200, up $2.800

Sep 16 Feeder Cattle settled at $135.825, up $2.375

Oct 16 Feeder Cattle settled at $134.800, up $2.100

Lean Hogs

Lean hog futures recorded 82.5 cent to $2.025 gains on Friday. Aug16 hogs were still down $2.65 on the week. The CME Lean Hog index for 7/20 was 51 cents lower to $77.87. The USDA national average carcass cutout price was 43 cents lower on Friday to $88.48, but still up nearly 1% from a week earlier. The average price of bellies was up $2.07/cwt on the day, but the average price of the rib cutout was $2.99/cwt lower than Thursday night. The national weighted average cash hog base price was down 47 cents. Regional average prices were 28 cents lower in IA/MN, and down 14 cents in the WCB. Weekly FI hog slaughter, including Saturday projections, was estimated at 2.141 million head, up 20,000 head from last week, and 47,000 head larger than the same period a year ago. Managed money reduced their CFTC net long position by 4,834 contracts during the week ending July 19, to an updated net long position of 54,783 contracts as of the close on Tuesday. There was 585.884 million pounds of frozen pork in warehouses as of June 30, per the USDA Cold Storage report this afternoon. The total was down 4.7% from May, and 7.7% smaller than June 2015.

Aug 16 Hogs settled at $75.275, up $0.825,

Oct 16 Hogs settled at $63.900, up $1.625

Dec 16 Hogs settled at $58.475, up $2.025

Cotton

Cotton futures closed 14 to 29 points lower, led by benchmark Dec16 cotton. That contract was down 160 points on the week. Managed money added 13,747 contracts to their net long CFTC position during the week ending July 19. As of the close on Tuesday, the group held a net long position of 63,266 contracts. In June, China imported 72,750 tonnes of cotton, down 55% from June 2015. According to Commonwealth Bank of Australia’s Tobin Gorey, there have been low levels of import quotas issued by the government. Any cotton imported without said quotas are faced by large import duties. The Cotlook A Index was 100 points lower to 83.30. ICE reported that there were 120,078 certified bales in storage warehouses on July 21, with 5,951 decertified bales. Last night, the USDA set the AWP for the upcoming week at 65.28. The LDP through next Thursday remains at zero.

Oct 16 Cotton settled at 72.520, down 14 points,

Dec 16 Cotton settled at 72.680, down 29 points

Mar 17 Cotton settled at 73.320, down 20 points


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