Featured Research

US Feeder Cattle and Hog Imports

Nov 17, 2:07 pm | Cattle, Hogs & Pork

Despite a larger US cow herd and inventory of feeder cattle, feeder cattle prices have generally been above last year since May, with the cash feeder index this week at $158 versus $120 a year ago. Higher prices have not only benefitted the US cow/calf producers, but have also helped out other North American producers. Cumulative feeder cattle imports from Mexico through early October are up 28% from a year ago and total just under 885,000 head.   While imports of Mexican cattle have increased over last year, imports of Canadian cattle continue to decline. The latest trade data shows YTD imports from Canada are just short of 108,000 head, and are down 35% at a 6 year low. Volatility…

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Soy Complex Export Commitments

Nov 16, 4:50 pm | Soybeans

FAS reported weekly soybean export sales this morning at a 6 week low of 1.1 MMTs, with weekly exports at 2.3 MMTs. Those 2 figures together take total US soybean export commitments to nearly 33 MMTs. Cumulative export shipments according to FAS’s count now total 17 MMTs, up 1 MMT from last year, and the largest soybean export rate on record. However, it’s the pace of sales, or rather outstanding sales that is disappointing. Outstanding sales are down 5.5 MMTs (26%) from a year ago, with the total just short of 16 MMTs. The USDA has maintained a record large soybean export forecast of 61 MMTs for the last 3 months, which means that US exporters have committed 53% of…

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2017/18 US Soybean Crush Update

Nov 15, 3:53 pm | Soybeans

NOPA reported that it’s membership crushed just over 164 Mil Bu of soybeans during the month of October, in line with expectations and nearly unchanged from a year ago. Based on the NOPA data, we estimate a total US soybean crush rate near 175 Mil Bu. The nearby soybean crush spread at the CBOT average near $.88/bu during the month versus $.75 last year and the 5 year average of $.95. The USDA projects a record large annual soybean crush rate of 1,940 Mil Bu, which at this time we agree with. But note in the chart that monthly crush rates need to hold at/near industry capacity well into 2018. Just 1 slow month will likely pull annual estimates down,…

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New Crop Russian Wheat Supply & Demand

Nov 14, 4:39 pm | Wheat

Two issues will keep growth the US’s share of world trade limited over the next 12 months, and both center on Russia. The first is that following incredible yields in 2017, trend yield in Russia will be elevated, and in fact trend yield there is growing at a pace much faster than anywhere else. A simple 20-year linear trend in 2018/19 is pegged at 2.68 MT/HA. Trend yield in Russia has grown 27% since 2010, which compares to growth in US trend wheat yield of just 9%. Russian farmers keep getting better. The second is that, while logistics will indeed cap exports, carryover stocks are forecast at a near record large 17 MMTs. This will keep the domestic market in…

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November WASDE Livestock Price Forecasts

Nov 13, 3:19 pm | Cattle, Hogs & Pork

The November WASDE report featured modest changes to pork production and price forecasts for 2018, and no significant adjustments are expected until the January report when the December inventory data will be available. For the 2nd quarter of year, the USDA estimates pork production at 6,390 million pounds, a 4% increase over 2017 and the largest 2nd quarter production figure on record. This will also mark the 8th consecutive year of industry expansion for the quarter. The USDA’s price forecast for the quarter was also unchanged from October at $47-51 live, or down nearly $3 from 2017. CME hog futures on the other hand are still more optimistic, and this week are offering producers a 2nd quarter average live price…

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Nov-Jan US Yield Changes

Nov 10, 4:21 pm | Corn, Soybeans

NASS still has one report left to fine tune US 2017 US row crop production,  major changes are unlikely. A corn yield above 170 (to say nothing about record yield) has been a surprise, but in January ARC expects yield to be maintained at 175, give or take fractions of a bushel. The adjacent graphic shows changes in corn & soybeans yields from Nov to Jan since 2000, it’s been rare for yields to change by more than 1.5%. In fact, since 1980, yield adjustments of just 1% or less catch a majority of NASS’s final report estimates. Even a yield change of 1.5% would imply corn yield up or down 2.5 Bu/acre, and a bean yield change worth just…

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Analysis of the USDA’s November Reports

Nov 9, 4:52 pm | Corn, Soybeans, Wheat

World 2017/18 stocks of wheat/soybeans are record large and up a combined 13 MMTs, while world corn stocks are down 23 MMTs to 204 MMTs! The net result is that Global Major World Crop ending stocks are down 10 MMTs, the first stock fall in 4 years! From 2012 into 2016, world major grain stocks grew just over 50% as world grain production was nearly double the growth in world demand. Somehow, world grain consumption has to catch up with production with most private estimates pegging China’s corn stocks some 75-100 MMTs above the WASDE forecast of 79 MMTs.   The graphic of global major crop ending stocks reflects that there is an abundance of grain in the world, and…

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Chinese Soybean Imports In October

Nov 8, 4:35 pm | China, Soybeans

The preliminary trade data from China that was released on Wednesday showed October soybean imports were up slightly from a year ago, and the largest import figure for the month, at 5.86 MMTs. The complete trade data will be released later in the month, but the US and Brazil are each known to have exported over 2 MMTs in the month of September. US exports jumped sharply through October, while the Brazilian export pace slowed. However, the Brazilian export pace has held above last year, which has limited the potential for early season US export totals. The October WASDE was about 1 MMTs too low on old crop Chinese soybean imports, and could reasonably raise the forecast for new crop…

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September Red Meat Exports

Nov 6, 1:22 pm | Cattle, Hogs & Pork

Last week’s International Trade report showed that US beef exports in September marked a fairly typical seasonal decline from August, but were still the largest September export figure on record at 243 million pounds. The September figure takes 3rd quarter exports to 746 million pounds, a 13% increase over last year, and also the largest 3rd quarter export total on record. Cumulative exports for the year are now just over 2 billion pounds, with only 1 other year (2011) having a larger beef export program. The chart shows monthly estimates for the 4th quarter based on the latest USDA forecast that calls for a 4th quarter export total of 745 million pounds. If realized exports for both the quarter and…

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