Hurricane Irma Could Affect Crops in Southeast
Sep 06, 2017
Good Morning! From Allendale, Inc. with the early morning commentary for September 6, 2017.
Grain markets consolidate after soybeans rally over 40 cents in 3 sessions and corn gains 17 cents. US yields continue to be the focus of the trade. Harvest results are beginning to come in with yields well below average. However, it is not unusual to harvest the poorest crops first. Stay tuned for harvest results as they come into our offices.
Crop Conditions report showed corn dropping 1% in the G/E category to 61%. Next week we should get the first harvest progress report which will be watched closely by trade. Soybeans were also 61% G/E remaining the same as last week. Trade was expecting an improvement in soybean conditions.
USDA September Supply and Demand report will be released on Tuesday Sep 12. Trade is concerned about how much they will change yields. Rich Nelson says out of the last 20 years it is almost a 50% chance with an average change of approximately 2%.
North American Free Trade Agreement (NAFTA) renegotiations are still at a “very early stage,” and cannot be assessed yet, says Mexico’s Confederation of National Chambers of Commerce.
FSA will release an update on US insured crops. This could have an impact on prices as harvested acres could have a significant affect on total production for corn and soybeans.
Central Brazil has growing concerns about very dry conditions and excessive moisture in Argentina and Uruguay, which may soon impede the start of plantings. In central Argentina profitability is clearly in favor of corn plantings followed by wheat and sunflowers, based on current prices. Brazil’s corn growers are expected to reduce corn acres this year.
Fed Cattle Exchange has 1240 head of cattle listed for auction today. Packers have excellent profit margin and want to keep production at capacity. History suggests cash markets could be steady to firm this week, however, the large supply of market ready cattle is weighing on rallies.
Spreaders have dominated live cattle futures the last few sessions by selling the October contract and buying the deferred. The October has lost nearly 3.00 to the February contract in the last 3 sessions as traders prepare for the Goldman Roll.
October live cattle futures posted the lowest close since March 15, 2017.
Lean hog futures rallied on Tuesday suggesting the start of a…