Grain and oilseed futures stayed fairly neutral in the overnight session ahead of possible week-end consolidating as futures test support levels during the seasonal low-price time of year. Weekly ethanol production came just slightly below last week with current pace still 5.3% above last year, compared to the USDA’s target increase of 0.8%. Expectations for the export sales data due out at 7:30 a.m. are 450,000-650,000 tonnes. The world’s second largest corn importer, China, is set to resume corn-based ethanol plants after a near decade-long ban which could help alleviate record-high stocks. December corn futures moved 1 cent lower to $3.745/bushel early Friday morning, while March lost 1.25 cents to $3.8525.
Soybean futures were steady early Friday morning ahead of the export sales report. Average estimates for soybean export sales are 1.0-1.5 million tonnes. The data to be released at 7:30 a.m. CDT could help renew the demand-driven rally we saw early in the week. Brazil’s planting season is forecast to be welcomed by weather this weekend, then more rain in their 6 to 10 day outlook. The nearby contract broke above the 50-day moving average on Tuesday for the first time since Aug 7, on data indicating revival of Chinese demand. November soybeans moved 0.5 cents higher to $9.0575/bushel early Friday, while December soyoil lost 0.02 cents to 28.56 cents/pound and December meal lost $0.3 to $313.7/ton.
Trading in the wheat market was quite overnight with futures a bit higher. Strategie Grains, the French consultancy, raised its wheat harvest estimate for the EU Thursday to record 149.5 million tonnes, 400,000 above the previous record last year, on crops that exceeded expectations in the Baltic States, Britain, France, and Germany. This estimate has lifted 5.5 million tonnes over the last two months as it became clear the crops were mostly spared by dry, hot weather. The wheat complex is on track for a second week of declines on plentiful global supplies. December CBOT wheat futures were 1.5 cents higher at $5.04/bushel early Friday, while Dec KC wheat gained 3 cents to $4.99, and December MWE moved 2.5 cents higher to $5.26.
Live cattle futures fell in concert with the rest of the protein complex Thursday, in part due to a stronger dollar. Even so, cash cattle steadily rose with boxed beef cutouts higher with choice up 0.61 to 211.22 and select up 1.61 to 207.23. Cattle slaughter so far this week was at 445,000 head, compared to 438,000 head last week and 444,000 head this time last year. December cattle lost 0.95 cents to 136.55 cent/pound Thursday, while February cattle fell 1.05 cents to 138.57 cents/pound. November feeder cattle moved 1.12 cents lower to 185.90 cents/pound, while January feeders lost 1.70 cents to 179.20 cents/pound.
CME lean hog futures tumbled Thursday on a stronger dollar and perhaps the early stages of seasonal demand weakness the trade has been expecting. Cash hogs were 1.50 higher to 70.04. Nearby hog futures continue to trade at a significant discount to cash but that spread is expected to narrow as demand wanes heading into winter. Hog slaughter so far this week is 1.692 million head, compared to 1.736 million last week and 1.712 million this time last year. December hog futures lost 0.30 cents to 66.82 cents/pound Thursday, while April hogs dropped 0.75 to 72.45.
ICE Cotton futures edged lower Friday on improving weather conditions. Early in the week, futures found strength as the cotton crop condition ratings fell 1 point lower than last week to 47% good to excellent and cotton progress came in at 22% versus the 25% five-year average. While the lower rating gave a boost, the damage to crops from southeast rains appeared to be less than expected. The move higher early in the week was also prompted by lower than expected supply data and on news in the soy complex that highlighted Chinese demand is still alive and well, despite recent setbacks in the financial markets. December cotton futures lost 0.18 cents to 63.26 cents/pound, while May cotton lost 0.30 cents to 63.68.