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www.thelandonline.com — “Where Farm and Family Meet”
THE LAND — NOVEMBER 13/NOVEMBER 20, 2020
MARKETING
Grain Outlook Corn export sales hit market year high
Livestock Angles Livestock market strong as long as dollar is weak
The following marketing under the “policy in place” Over the past few months month of September. However, analysis is for the week endscenario. Since China has not the livestock markets have if cattle prices continue to ing Nov. 6. officially raised their 7.2 mmt been extremely choppy and strengthen, the demand for low tariff import quota, the very erratic. This is not that replacement cattle will CORN — As noted last USDA has held their estinew in the livestock markets. increase. The bottom line is, it week, the uptrend was bent mate at 7 mmt. How the However, at this juncture, it appears the cattle market is but not broken. This week’s USDA may handle this on the appears this condition is likein the process of finding a botaction confirmed that outlook Nov. 10 WASDE report will be ly to endure into the near tom and could improve in the in post-election trading when interesting. future. weeks ahead. corn held the previous week’s JOE TEALE PHYLLIS NYSTROM low and rebounded. The week China has been rebuilding The American economy is The hog market has seen Broker CHS Hedging Inc. began with a new 8 million their state reserves as well as continuing to recover; while prices come under a little St. Paul bushel sale announcement to satisfying domestic demand internationally, other world Great Plains Commodity pressure the past several Afton, Minn. unknown, but closed slightly in light of high domestic pric- economies are still trying to weeks. The demand for pork weaker. The market then proes. In Mexico, they lowered recover. This will continue to has slowed somewhat and ceeded to close higher for the next their 2020 corn import outlook to 16.75 leave the export of beef and pork ques- numbers of live inventory have three sessions. This pushed the mmt from 17.2 mmt citing lower feed tionable if the dollar strengthens in the remained more than adequate to meet December contract to fill the overhead demand. They expect to originate 93 near future. So far, the dollar has the weakening demand. At present, the gap left from Oct. 28 and closer to the percent of their corn import needs from remained weak which has made market has seen a decline in price since $4.24 contract high. the United States and the balance from American meat products very attrac- mid-October and could possibly find tive. But if other countries stay with some recovery in live prices in the near The high this week in December corn Brazil. was $4.17.25 per bushel. The weekly Weekly ethanol production increased weakened economies, the U.S. dollar term. However, technically the market high in the March contract was $4.22.25 20,000 barrels per day to 961,000 bpd. could strengthen and disrupt our appears weak at this juncture; and if funds begin to liquidate further, this per bushel vs. the contract high of This is the highest production number improved meat exports. $4.33 per bushel. The demand outlook since March. Gasoline demand fell to As for the cattle market, beef move- could pressure prices even further. with expectations for a smaller carry- 8.33 million bpd from 8.54 million bpd ment has been improved over the past One thing looking as if it may stand out number on the November World and down 8.8 percent from the same several months which has helped cattle in the way of a rally would be that Agriculture Supply and Demand week last year. The four-week gasoline prices as we muddled through the China has been effectively been rebuildEstimates report, less-than-ideal rain- demand is down 10.8 percent from last heavy cattle. It now appears that ing its hog herd. This would put into fall in Argentina and southern Brazil, year. Ethanol stocks were up 100,000 weights are now topping and if demand question the likelihood exports to and managed money adding to length, barrels to 19.7 million barrels. Margins remains the same or increases, this China could rapidly decline. In any all combined to keep this market well improved 4 cents to 16 cents per gallon. would be a positive for price apprecia- event, the outlook for the hog market is supported. at a crossroads and the next several The average trade guesses for the tion in the months ahead. Weekly export sales were higher than See NYSTROM, pg. 21 Grain prices have slowed the upward weeks are likely to set the tone of the expectations at 102.8 million bushels surge in replacement cattle since the market through the remainder of the year. v — a marketing year high! Total sales commitments of 1.3 billion bushels are running 179 percent ahead of last year. This is a record for this point of the marketing year. Total sales account for corn/change* soybeans/change* 56 percent of the U.S. Department of Stewartville $3.78 +.09 $10.71 +.66 Agriculture’s 2.325-billion-bushel Edgerton $3.86 +.12 $10.76 +.65 export forecast. China has purchased Jackson $3.89 +.07 $10.88 +.75 425 million bushels of U.S. corn for the Janesville $3.83 +.11 $10.76 +.75 2020-21 marketing year. Cannon Falls $3.66 -.10 $10.36 +.09 The USDA attaché to China is expect Sleepy Eye $3.78 +.12 $10.81 +.75 ing China to import 22 million metric Average: $3.80 $10.71 tons of corn this marketing year, a distinct difference from the USDA’s refus Year Ago Average: $3.53 $8.47 al to move off their 7 mmt outlook. In Grain prices are effective cash close on Nov. 10. defending their stance on this, the *Cash grain price change represents a two-week period. USDA last week said they operated
Cash Grain Markets
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Information in the above columns is the writer’s opinion. It is no way guaranteed and should not be interpreted as buy/sell advice. Futures trading always involves a certain degree of risk.
