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BRIAN HOOPS

By Staff | Nov 29, 2013

COF report

In the monthly cattle on feed report, the USDA reported U.S. cattle and calves on feed for slaughter market for feedlots with capacity of 1,000 or more head totaled 10.6 million head on Nov. 1. The inventory was 6 percent below Nov. 1, 2012.

Placements in feedlots during October totaled 2.39 million, 10 percent above 2012. Net placements were 2.32 million head.

During October, placements of cattle and calves weighing less than 600 pounds were 720,000, 600-699 pounds were 584,000, 700-799 pounds were 510,000, and 800 pounds and greater were 580,000.

Marketings of fed cattle during October totaled 1.86 million, 1 percent above 2012. Other disappearance totaled 75,000 during October, 4 percent below 2012.

Cold storage

In the monthly cold storage report, the USDA reported total red meat supplies in freezers were down slightly from the previous month and down 2 percent from last year.

Total pounds of beef in freezers were down slightly from the previous month, but up 3 percent from last year.

Frozen pork supplies were down slightly from the previous month and down 6 percent from last year. Stocks of pork bellies were up 17 percent from last month and up 47 percent from last year.

Deere earnings

Deere & Co., the world’s largest maker of agricultural equipment, forecast better-than-forecast earnings for its 2014 fiscal year on rising demand for construction machinery in the U.S. Net income will drop to about $3.3 billion in the year through Oct. 31, Deere said in a statement.

That’s more than the $3.06 billion average of 17 analysts’ estimates compiled by Bloomberg.

Deere said equipment sales will fall about 3 percent, compared with an average estimate of a 9.5 percent decline.

CORN ANALYSIS

Corn closed the week $.01 3/4 lower. Last week, private exporters did not report any private sales.

Weekly export sales of corn showed a total of 37.2 million bushels, well above the 9.5 mb needed each week to reach the USDA forecast of 1.225 billion bushels.

Annual exports total 961 mb of the 1.225 bb that was forecasted and is 490 mb better than last year’s export pace.

The USDA reported U.S. crop progress has now reached 91 percent harvested. The five-year average pace is 86 percent complete.

Argentine corn planting advanced to 40 percent complete as of Nov. 14, up from 36 percent the week earlier, but remains significantly behind average of 68 percent.

The late start to planting given early dryness has been followed by heavy rains of late, which ultimately will likely prove beneficial, but are keeping activity slow at the moment.

Corn looks more likely to fall into a trading range for the winter months with $3.87 downside price support.

Strategy and outlook: Producers are 100 percent sold of 2013/14 crop. Producers are 10 percent sold of the 2014/15 crop.

SOYBEANS ANALYSIS

Soybeans closed the week $.39 higher from last week. Last week, private exporters reported a sale of 355,000 metric tons of soybeans to China.

Weekly export sales of soybeans showed a total of 50.6 mb, well above the 8.1 mb that is needed each week to reach the USDA forecast of 1.37 bb.

Total export sales of 1.303 bb is 90 percent of the USDA’s forecast.

The USDA reported U.S. soybean harvest is at 95 percent complete as of Nov.10. This number is slightly below the five-year average of 96 percent.

Brazilian soybean planting continues to move along at an excellent pace, with 73 percent planted as of Nov.14, up from 59 percent the previous week and compares to 64 percent average.

Argentina advanced to 26 percent complete, up 10 percent from the previous week, but still behind the average pace of 32 percent.

Weather looks nearly ideal in South America, but any stretch of adverse weather should send prices soaring. If this occurs, producers should look to sell remaining inventory levels and make 2014/15 sales.

Strategy and outlook: Producers are 80 percent sold of the 2013/14 crop. Sell 10 percent at $13.53 and 10 percent at $13.74.

Producers are 10 percent sold of 2014/15 production. Sell 10 percent at $12.10.

This material has been prepared by a sales or trading employee or agent of Midwest Market Solutions and is, or is in the nature of, a solicitation. The risk of loss in trading futures and/or options is substantial and each investor and/or trader must consider whether this is a suitable investment. We do not guarantee that such information is accurate or complete and it should not be relied upon as such.

Brian Hoops can be reached at (605) 660-1155.

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