AgriCharts Market Commentary

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Corn futures are fractionally lower this morning. Most contracts settled steady to 2 1/4 cents higher on Tuesday. Traders are still keeping an eye on the Brazilian crop, and the dryness they’re experiencing. Most states in the Corn Belt are at or above their respective planting progress averages, with IA lagging normal pace by 2%. States along the Northern parts of the Corn Belt are behind normal pace for emergence. The national average basis at -34 cents is 2 3/4 cents stronger than a year ago. Argentina’s 18/19 crop is seen as rebounding to 40 MMT according to analysts with the country’s Maizar. They are still harvesting the 2017/18 crop at the moment. China customs confirmed April sorghum imports from all origins totaled 640,000 MT, with the YTD at 2.33 MMT. Corn imports were 380,000 MT for the month, bringing the 2018 total to 940,000 MT.


Soybean futures are currently 1 to 2 cents higher after extending Monday gains by 5 to 6 cents on Tuesday. Soymeal was down $1.60/ton, with front month soy oil 9 points higher. The Northern part of the US (MI, MN, WI and the Dakotas) is the only area to show meaningful planting progress delays. A trucker strike in Brazil is slowing the transport of soybeans to export terminals. Brazilian FOB soybean quotes have dropped below US Gulf offers, however, by about $7/MT. A strike against Cargill in Argentina was halted by a government back to work order. Soaring inflation there and the sliding peso value are aggravating labor issues.


Wheat futures are trading 2 to 4 cents lower in the W and KW contracts this morning. The Minneapolis (MW) contracts are trading steady to 1 cent higher. Wheat saw gains of 13 to 14 cents in the nearby HRW and SRW contracts yesterday, with Minneapolis HRS up 10 to 11 1/4 cents. For the most part the Southern Plains is expected to see little moisture over the next week. That coupled with dryness in other major exporting countries supported prices on Tuesday. The US dollar index was weaker on the day. Winter Wheat conditions in KS improved by 7 points over the past week, with OK steady and TX down 8. Spring wheat planting is now ahead or matching the average pace in MN, ND and SD, with the other states lagging. Japan is seeking 96,870 MT of US and Canadian wheat in their weekly MOA tender due on Thursday. Of the total, 63,735 MT is sought from the US.


Live cattle futures finished steady to 42.5 cents higher on Tuesday, with nearby June down 2.5 cents. Feeder cattle futures were steady to 22.5 cents in the green. The CME feeder cattle index was down 24 cents on May 21 at $133.41. Wholesale boxed beef values were lower. Choice boxes were down $1.47 at $229.35, with Select boxes $1.66 lower at $205.86. FI cattle slaughter was estimated at 239,000 head through Tuesday. That is 4,000 head larger than this time last year. Tuesday afternoon’s USDA Cold Storage report indicated 471.545 million pounds of frozen beef stocks were in storage at the end of April. That was 2.86% larger than this time last year and up 1.63% from March. Analysts are expecting to see April feedlot placements at an average of 1.68 million head, which is 9.1% lower than the same month last year. The Cattle on Feed report is scheduled for Friday morning at 11 AM CDT.

Lean Hogs

Lean hog futures settled 15 cents to $1.725 lower on Tuesday. The CME Lean Hog Index was up 62 cents from the previous day to $68.36 on May 18. The USDA pork carcass cutout value was up 4 cents at $76.14 Tuesday afternoon. Most primal cuts were higher, with the picnic and ham both reported lower. The national base hog weighted average price was UNCH at $64.78 in the afternoon. The USDA estimated FI hog slaughter at 915,000 head through Tuesday. That is down 5,000 head from last week but 35,000 above the same week in 2017. Frozen pork stocks at the end of April totaled 641.407 million pounds per the USDA Cold Storage report. That was 5% above March and 8.65% larger than April 2017. Belly stocks were 64.563 million pounds, up 9% from March.


Cotton futures are trading UNCH to 10 points lower this morning. They were down 25 to 60 points in most contracts on Tuesday. After gaining 5.5% in the past week, July was 107 points lower on profit taking. The dollar was weaker. Texas was shown at 43% planted, with Georgia at 56% complete in Monday’s Crop Progress report. Next week’s report will show progress for squaring. China sold all 30,000 MT of cotton offered at an auction of state reserves on Tuesday. The Cotlook A index was up 120 points from the previous day to 94.45 cents/lb on May 21.

Market Commentary provided by:

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