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Grain Futures Prices Lower on USDA Reports

Thursday's Closing Grain + LIvestock Futures Prices

Sep. corn closed at $3.31 and 3/4, down 7 cents
Sep. soybeans closed at $10.61 and 1/2, down 9 and 1/2 cents
Sep. soybean meal closed at $426.70, down $16.10
Sep. soybean oil closed at 31.44, down 14 points
Sep. wheat closed at $5.03, down 15 and 3/4 cents
Oct. live cattle closed at $157.37, down $2.32
Oct. lean hogs closed at $106.37, down 72 cents
Oct. crude oil closed at $92.83, up $1.16
Dec. cotton closed at 68.09, up 95 points
Sep. Class III milk closed at $24.48, up 3 cents
Sep. gold closed at $1,237.40, down $6.10
Dow Jones Industrial Average: 17,049.00, down 19.71 points

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View USDA Sept 11 WASDE and Crop Production Reports:

Ag Market News and Commodity Comments

Soybeans were lower on commercial and speculative selling. USDA sees production at a record 3.91 billion bushels, with an average yield of 46.6 bushels per acre. Also, USDA raised new crop ending stocks, while lowering the average farm price. Still, contracts did manage to close above the session lows, and these numbers don’t reflect any damage since the start of the month. Soybean meal and oil were lower on the bearish tone in beans. China bought a total of 600,000 tons of 2014/15 soybeans, 240,000 outright from the U.S. and 360,000 tons optional origin, while unknown picked up 210,000 tons of 2014/15 U.S. beans.

Corn was lower on commercial and speculative selling. Corn is projected at a record 14.4 billion bushels with an average yield of 171.7 bushels per acre. That led to a big jump in new crop ending stocks, to over 2 billion bushels. Still, like beans, most contracts did manage to close above the session lows, and these numbers don’t reflect any damage since the start of the month. Ethanol futures were lower. China’s National Grain and Oils Information Center estimates corn production at 213.8 million tons, down 8.5 million on the month due to widespread drought. USDA expects China’s corn crop to be 217 million tons. Corn stocks are around 60 million tons, which is expected to alleviate some of the impact.

The wheat complex was lower on commercial and speculative selling. Domestic wheat ending stocks were up on the month, with USDA increasing imports while lowering exports. The world numbers were negative, with larger ending stocks and production estimates. Aside from the latest set of USDA numbers, the trade’s keeping an eye on snow in Canada and the Northern U.S. Plains. Japan bought 51,600 tons of food wheat from the U.S., along with 29,400 tons from Canada and 28,800 tons from Australia.

USDA Mandatory reported cattle trading was light in all regions on Thursday on light demand. Around 1200 head of cattle in Nebraska traded at 248.00 to 251.00 dressed. Close to 5200 head in Iowa/Minnesota at 158.00 to 160.00 live and 248.00 to 252.00 dressed. There were not enough in any area for an adequate market test. Asking prices remain firm around 165.00 to 167.00 in the South and 255.00 plus in the North. Thursday’s cattle slaughter at 116,000 head is down 3,000 from last week but even with last year.

Boxed beef cutout values were steady on the choice and sharply lower on select on light to moderate demand and offerings. Choice boxed beef is up .08 at 251.14, and select 236.35 down 1.83.

Live cattle contracts on the Chicago Mercantile Exchange settled 17 to 232 lower. Active selling pressure quickly redeveloped across the nearby live cattle futures with triple digit losses holding in the October and December contracts. The inability of sellers to push boxed beef prices significantly higher through the week created some widespread legitimate concerns about the sustainability of prices at this level through the upcoming fall months. October settled 2.32 lower at 157.37 and December was down 2.40 at 159.00.

Feeder cattle settled 80 to 162 points lower as traders focused on aggressive triple digit losses in the nearby live cattle futures. The expectation that additional pressure in live cattle could develop over the coming days caused many feeder cattle traders to quickly square positions. September settled .80 lower at 228.05 and October was down 1.45 at 225.60.

Feeder cattle receipts at the Huss Platte Valley Auction in Nebraska totaled 3066 head on Wednesday. Compared to two weeks ago steers and heifers traded at sharply higher prices. Demand was good on all offerings from beginning to end. 236 head of feeder steer calves with an average weight of 629 pounds brought 265.05 per hundredweight. 119 heifers averaging 624 pounds traded at 247.37.

Lean hogs settle .65 higher to 145 points lower. The market closed mixed after continued up and down movement in a moderate range for most of the session. The combination of sharp cash price reductions and strong gains in pork values in the morning reports created mixed signals that eroded nearby support but helped to draw buyer interest into summer 2015 contracts. October settled .72 lower at 106.37, and December was down 1.45 at 97.20.

There was moderate hog market activity and demand on Thursday afternoon. Barrows and gilts in the Iowa/Minnesota direct trade were .16 lower at 102.84 weighted average on a carcass basis, the West was down .01 at 102.58, and the East had no price comparison at 95.67.  The Missouri direct base carcass meat price was steady from 87.00 to 94.00. Midwest barrows and gilts were fully steady from 60.00 to 70.00 live.

The pork carcass value was up 1.38 FOB plant at 107.53. Loins ended over 5.00 higher in the afternoon report.

For the week ending September 6, the average weight of Iowa barrows and gilts jumped to 282.1 pounds, 1.5 pounds heavier than the previous week and 11.4 pounds bigger than 2013. Seasonally, market hogs should continue to grow.

Thursday’s hog slaughter was estimated at 411,000 head, 6,000 more than last week, but 19,000 less than last year.


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