NEWS

*The Commodity Futures Trading Commission Sunday issued an order simultaneously filing and settling charges against Trafigura Trading LLC, a global commodities merchant with its principal place of business in Houston, Texas, for multiple violations of the Commodity Exchange Act and associated CFTC regulations. The order requires Trafigura to pay a $55 million civil monetary penalty and implement certain remedial measures to ensure future compliance with the CEA.

CORN

ANALYSIS

Corn closed the week $.15 1/2 lower. Last week, private exporters did not announce any export sales.

In the weekly export inspections report, U.S. corn export inspections, for the week ended June 13, were 50.7 million bushels, comparable to the previous week’s 52.8 million bushels (mb) but well above last year’s same-week exports of 32.7 mb while continuing the solid pace of shipments of late, having averaged 50.9 million bushels/week over the most-recent four-week period and 49.2 million/week over the eight weeks. Now with 11 full weeks remaining in the 2023-24 marketing year, cumulative export inspections of 1.591 billion bushels are up nearly 27% from last year’s 1.257 billion, slightly behind the USDA’s 2.150 billion bushel export projection reflecting an estimated 29.4% increase in exports from last year. Corn export inspections will need to average roughly 30.9 mb/week through the end of August to reach the USDA’s export target.

In the weekly EIA report, U.S. ethanol production, for the week ended June 20, rose to 1.057 million barrels/day from 1.023 mbpd the previous week and was similarly near unchanged from last year’s same-week production of 1.052 mbpd as was the case the previous week, as well. The overall pace of ethanol production continues to run in line with, to above, the “needed” pace in order to reach the USDA’s 5.450 billion bushels, having averaged pluls-2.1% vs. last year over the last eight weeks. U.S. ethanol stocks last week also rose, hitting a four-week high at 23.617 million barrels vs. the previous week’s 23.222 million barrels. With the increase, ethanol stocks remain at same-week record-high status in being above 2022’s stocks at this time of 986 million gallons and are 3.6% (34 millon gallons) above year-ago mid-June stocks of 958 million gallons.

In the weekly crop progress and conditions report, U.S. corn conditions fell 1% to 72% good/excellent vs. 73% expected, 74% last week and 55% last year. Conditions for this time of year are the best in six years. Corn emergence is at 93%. Key states of Iowa improved 1% to 74%; Minnesota fell 3% to 71%; Illinois fell 9% to 65%; Nebraska fell 3% to 81% and Missouri rose 6% to 75%.

STRATEGY & OUTLOOK

Producers have established a floor with put options and put/call spread as well as making 2024 cash sales. One hundred percent protection is advised.

SOYBEANS

ANALYSIS

Soybeans closed the week $.28 lower. Last week, private exporters did not report any export sales.

U.S. soybean export inspections last week were 12.3 mb, up modestly from the previous week’s 8.6 mb and above last year’s same-week exports of 6.6 mb while continuing to run at a pace necessary to reach the USDA’s 1.7 billion bushel export projection. Over the last four weeks, soybean export inspections averaged 10.6 mb/week, comparable to the 11.3 mb/week average that will be needed over the final 11 weeks of the marketing year to reach the USDA’s export target vs. last year’s 7.4 million/week average during the same period. Cumulative export inspections of 1.502 billion bushels are down 16.6% from last year’s 1.801 billion vs. USDA estimating this year’s exports to be down 14.7% from last year.

The crop progress report showed US soybean conditions fell 1% on the week to 70% good/excellent vs. 71% expected, 72% last week and 54% last year. Conditions for this week in June are the best in four years. Key states of Iowa rose 1% to 74% g/e; Illinois lost 8% to 61%; Minnesota lost 1% to 70%; Nebraska was unchanged at 79% and Missouri gained 5% to 69% g/e. Soybean planting is 93% complete vs. 94% expected, 87% last week, 97% last year, 91% average and emergence is 82%.

The monthly NOPA crush report came in at 183.625 mb, well above estimates of 178.4 mb, last month’s 169.4 mb and last year’s 177.9 mb. This should be a new record for the month. Soybean oil stocks came in at 1.724 bp vs. estimates of 1.775 bp, 1.832 bp last month and 1.875 bp last year.

STRATEGY & OUTLOOK

Producers have established a floor with put options and put/call spread as well as making 2024 cash sales. One hundred percent protection is advised.

WHEAT

ANALYSIS

For the week, Chicago wheat closed $.48 lower and Kansas City wheat closed $.50 1/4 lower. Last week, exporters did not announce any export sales.

U.S. wheat export inspections, in the second week of the 2024-25 marketing year, were 13.8 mb, little-changed from the previous week’s 12.9 mb, while besting last year’s same-week exports of 8.7 mb. In the very early goings of the new marketing year, cumulative export inspections of 24.7 million bushels compare to 20.4 million last year. In order to reach the USDA’s 800 million bushel export projection, wheat export inspections will need to average roughly 15 million bushels/week throughout the marketing year vs. last year’s 13.3 million/week average from this point forward.

In the weekly crop progress and conditions report, U.S. winter wheat conditions rose 2% to 49% good/excellent vs. 46% expected, 47% last week, 38% g/e last year. Conditions increased from last week to six-week high and SRW conditions best in 24 years. Winter wheat harvest 27% complete vs. 22%, 12% last week, 13% last year and 14% average. Texas is 63% harvested with Oklahoma 83%, Missouri 38% and Kansas 28% done.

Spring wheat conditions rose solidly to 76% good/excellent vs. 71% expected, 72% last week and 51% g/e last year. Minnesota is 83% g/e, up 9%; North Dakota up 3% to 82%; South Dakota unchanged at 68% and Montana up 9% to 70%.

STRATEGY & OUTLOOK

Producers have established a floor with put options and put/call spread as well as making 2024 cash sales. One hundred percent protection is advised.

LIVE & FEEDER CATTLE

ANALYSIS

Last week, live cattle closed $.20 higher while feeder cattle closed $3.72 lower.

The monthly Cattle on Feed report should be viewed as bearish as placements were well above not only pre-report estimates but also last month’s figures. On feed supplies at 11.583 million head is bearish as well as there are only five years since 2000 that reported larger May on feed numbers than this year. The placements at 2.046 million head, were nearly 6% larger than the average trade guess and should pressure October and December futures. Marketings at 1.955 million head were in line with trade estimates.

Last week, light trade in the North at $310 to $312 dressed which is $4 to $6 firmer than last week. Light trade volumes in the South at $189 to $190 live, which is $3 higher compared to the previous week.

Last week, the Fed Cattle Exchange offered 1,494 head for sale and 118 head of cattle sold at $195.

The latest USDA steer carcass weights were down 6 pounds from last week at 918 pounds which is 36 pounds above year-ago levels.

The weekly export sales report has net beef sales of 14,900 mts with shipments of 16,800 mts.

STRATEGY & OUTLOOK

Producers should have re-established window or fence strategies to protect the downside but allow for upside potential as values approach weekly resistance.

LEAN HOGS

ANALYSIS

Lean hogs closed the week $1.17 lower. Iowa/southern Minnesota weekly hog weights for week ending June 15 has weights down to 287.4 pounds vs. 289 pounds last week and 278.5 pounds last year.

The weekly export sales report has net pork sales of 21,400 mts with shipments of 29,000 mts.

STRATEGY & OUTLOOK

Producers should have re-established hedges as values tested weekly chart resistance and commercials were hedging.