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Grain Outlook Corn sale to China boosts price, but it didn’t last

Livestock Angles Glut of animals holding down livestock prices

The following marketing weekly 4 mmt offered at aucAs the month of August The export market has been analysis is for the week endtion was not fully subscribed. comes to a close, the livestock a bit busier; which has helped ing Sept. 3. Only one-third of the amount markets appear to be changprices of beef advance in CORN — An exciting start to the week as we closed out August; and December corn soared to take out the July double top at $3.63 and surpassed the 200-day moving average for the first time since October. December ran to a high of $3.64.25 — its highest since March. PHYLLIS NYSTROM CHS Hedging I n . St. Paul was sold, but this may be because no cheaper 2015 corn was included. Higher priced 2016-2018 corn was in the auction. China has sold 56.8 mmt of reserve corn this year compared to 21.1 mmt last year by this time. Weather talk has already begun to turn toward frost ing their current upward price trends. Fundamental changes in supplies in all facets — for both cattle and hogs — halted the recent rallies experienced over the past 30 days. The supplies beef — and particularly the supplies of pork — have cast a negative JOE TEALE Broker Great Plains Commodity Afton, Minn. recent weeks. However, with schools not opening because of the Covid virus, the school lunch demand for meat is likely to drop off to some degree. At this time it doesn’t appear to be much more than a correction after a couple of months of increased prices in all areas of the trade. Disappointing weekend rain prospects. Current forecasts shadow over the futures and The hog market appears to inspired the jump which was then for Sept. 8-12 suggest the potential for a cash markets during the last part of have a similar fate as the cattle maraided by a 23.5 million bushel corn sale hard frost in parts of Minnesota, North the month of August. Also, the recent ket: lower prices in the weeks ahead. to China. However, the surge didn’t Dakota and western Nebraska (subject supply numbers of either cattle on feed The pork cutout seems to be struggling last, and we closed near the day’s low. to change). Along with the cold front or the hog inventory reports have indiat the present time as prices have gone Sept. 1 brought an identical sale to China, but even that wasn’t enough to bring buyers into the market. Through Sept. 3, China has purchased approximately 343.7 million bushels for the 2020-21 crop year and is likely higher depending on how many sales to unknown will eventually end up being will come higher chances for rain, that may delay harvest starts in Nebraska. At this point, additional rainfall will be of small use to maturing crops. Brazil did not renew their zero-tariff quota for ethanol imports. The 198 million gallon zero-tariff quota was used nearly exclusively for U.S. ethanol cated bigger numbers available for slaughter for both. Unless we see an increase in demand for either beef or pork, one might conclude that weaker prices for both cattle and hogs might be imminent. The cattle market has seen a slowdown in the movement of beef the past sideways recently. The futures market suffered a weekly reversal during the last full week of August which normally signals an end to the trend — which had been up. Therefore, at minimum, there should be a short-term correction in both cash and futures over the next week or so. to China. imports. They are considering re-impleseveral weeks and the futures market If demand for pork remains strong Is China facing a corn shortage? A Reuters survey of analysts feels China could experience a corn deficit in the coming year of up to 30 million metric tons (1.18 billion bushels). China’s lowtariff quota for corn is 7.2 mmt (283.5 million bushels) but is expected to be exceeded for the first time. There are estimates China could import up to 15 mmt of U.S. corn (590 million) with 9 to 10 mmt already on the books to either China or unknown destinations. See NYSTROM, pg. 9 during that period it should help keep the correction in prices to a minimum. The real negative to the market at the present time is the amount of pork in cold storage. There will have to be a decrease in that cold storage number to halt the negative outlook for hog prices and to end the current push toward lower levels. v has reacted with a sell-off in the past couple of weeks. The sluggish action in the futures trade and the packers backing down their bids for live inventory seem to have cast a slightly negative attitude as we move into the month of September. For marketing Cash Grain Markets corn/change* soybeans/change* menting the zero-tariff quota for three months, but all U.S. ethanol imports are currently subject to a 20 percent tariff. Brazil reportedly is wanting to renegotiate trade terms with the United States on imports of Brazilian sugar. Food inflation is the highest in the 10 years and state reserve stocks are St. Cloud Madison $3.06 $3.07 +.11 +.14 $8.98 $9.01 +.48 +.53 news between believed to be minimal as corn prices in China’s breadbasket hit five-year highs in late August. China’s agriculture minister projects 2020-21 corn production of 266.5 mmt with ending stocks at a Redwood Falls Fergus Falls Morris Tracy $3.08 $2.92 $2.97 $3.05 -.01 +.09 +.10 +.14 $9.04 $8.93 $8.97 $8.99 +.54 +.53 +.52 +.53 issues ... visit www. negative 16.7 mmt. Other grains could fill part of any feed shortfall, including barley, sorghum or feed wheat. China is urging citizens to limit food waste. Average: $3.03 $8.99 Year Ago Average: $3.27 $7.64 Grain prices are effective cash close on Sept. 8. TheLand Online.com

For only the second time ever, China’s *Cash grain price change represents a two-week period.