After the Bell | September 7, 2021

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Corn: December futures fell 13/ 1/4 cents to $5.10 3/4 a bushel, the new-crop contract’s lowest settlement since $5.04 1/4 on April 13. December futures extended last week’s 5.4% slide as speculators continued to pare long positions and traders eyed USDA’s Sept. 10 Crop Production Report, in which the agency is widely expected to hike its yield and production estimates. U.S. farmers will harvest 14.94 billion bu. of corn this year at an average national yield of 175.8 bu. per acre, based on average estimates in a Reuters survey of analysts. In August, USDA estimated the crop at 14.75 billion bu. and the average yield at 174.6 bu. per acre. Late today, USDA reported 59% of the U.S. corn crop in “good” or “excellent” condition as of Sept. 5, down from 60% the previous week and about 1 percentage point lower than analyst expectations. About 74% of the crop was dented as of Sept. 5, USDA said last week, 5 percentage points higher than the average at this point the previous five years.

Soybeans: November soybeans fell 15 cents to $12.77 a bushel, the lowest closing price since June 25. Recent Midwest weather was considered favorable for late-season crop development, with bearish traders also anticipating a traditional seasonal decline as the harvest season looms. USDA today reported 57% of the U.S. soybean crop in good-to-excellent condition as of Sept. 5, up from 56% the previous week but down from 65% a year ago. The latest good-to-excellent rating met trade expectations. Soybean traders await USDA Sept. 10 reports in which the agency is expected to revise lower its domestic usage forecasts. Also, market bulls have likely been disappointed that no daily announcements of large sales to China have been announced in recent days.

Wheat: December SRW wheat fell 6 1/2 cents at $7.19 3/4. December HRW wheat fell 5 1/2 cents to $7.17 1/2. December spring wheat futures fell 4 1/4 cents to $9.08 1/4. Wheat futures were pressured by spillover selling from sharp declines in corn prices and U.S. dollar strength, as well as reports early today that Australia is forecast to produce its second-largest wheat crop ever in 2021-22. Also today, USDA reported a daily sale of 327,300 metric tons (MT) of hard red winter wheat for delivery to Nigeria during the 2021-22 marketing year. The U.S. spring wheat harvest was 95% complete as of Sept. 5, up from 88% the previous week, USDA said this afternoon. The latest harvest figure was about 1 percentage point above expectations.

Cotton: December cotton rose 3 points to 94.05 cents per pound. The cotton market bulls continue to show resilience, holding prices near steady at elevated levels despite a sell-off in grain futures, a stronger U.S. dollar index and a wobbly U.S. stock market to start the trading week. Still-firm demand for cotton is keeping a floor under prices. USDA’s latest weekly crop condition ratings suggested Hurricane Ida may have caused minor damage to U.S. cotton acres. The crop’s good-to-excellent rating was 61% as of September 5, down from 65% a week earlier, USDA said. Cotton traders await USDA’s Sept. 10 Crop Production and Supply and Demand reports. A Bloomberg survey showed analysts on average expect U.S. cotton production at 17.69 million bales and U.S. exports at 15.06 million.

Cattle: Live cattle futures extended last week’s 3.3% slide as wholesale beef prices remained under pressure and speculators continued to shed long positions. Ag commodities in general were under fund-driven pressure to start the week, with corn futures closing at a five-month low ahead of USDA’s Sept. 10 Crop Production report. Choice cutout values fell 95 cents early today to a three-week low of $335.47, on movement of about 34 loads, USDA reported. Cattle futures are undergoing technical breakdown, as lead contracts pushed below several moving averages and other key chart support levels over the past week. October live cattle fell as low as $123.675, the contract’s lowest intraday price early June and near the 200-day moving average, just above $123.00. Other chart levels to watch include the June 1 spike low to $119.825.

Hogs: October hog futures fell $1.475 per hundredweight to $88.10 per hundredweight. Eroding wholesale pork prices and expectations for seasonal weakness resulted in a soft start to the holiday-shortened week. Carcass cutout values fell $2.48 today to an average of $105.67, the lowest daily price since March 22, according to USDA data. The preliminary CME index quote for last Friday was expected to fall to $99.30, dropping under $100 for the first time since early April. Negative sentiment prevails despite the hog market’s decided tendency to post an intermediate-term low just after Labor Day and rebound modestly over the following five to six weeks.


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