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Wheat

For the week ending Sept. 6, Chicago wheat closed 1 cent higher; Kansas City wheat closed 4 cents lower and Minneapolis wheat 2 cents lower. Private exporters did not announce sales.

In the weekly export inspections report, U.S. wheat exports were 19.3 million bushels and were little-changed from the previous week's 18.5 million bushels and were solidly above last year's same-week exports of 15.0 million bushels. Cumulative export inspections of 241 million bushels are up nearly 25 percent from last year's 193 million at this time, with wheat exports needing to average roughly 18.4 million bushels per week through the end of next May in order to reach the USDA's 975 million bushel export projection. In the weekly crop progress and conditions report, U.S. spring wheat conditions 67 percent good-to-excellent vs. 69 percent expected and 69 percent the prior week. U.S. spring wheat harvest is now 55 percent complete vs. 57 percent expected, up from 38 percent from the week prior, 86 percent last year and 78 percent average. Number one spring wheat producer North Dakota is 52 percent harvested, well behind the normal pace of 73 percent.

Strategy & Outlook

The huge world supplies of wheat mandates producers to sell out inventory and use options to manage risks on sharp rally attempts.

Corn

Corn closed the week ending Sept. 6 at 13 cents lower.  Private exporters did not announce any export sales.

In the weekly export inspections report, Corn exports ended the 2018-19 marketing year with only 14.0 million bushels shipped, down from the previous week's 25.4 million bushels and well below last year's 52.6 million bushels. It was also the second lowest of the entire marketing year behind the last week of June's 11.2 million bushels. With two days of data remaining, 2018-19 cumulative corn export inspections were 1.857 billion bushels vs. last year's 2.273 billion. In the weekly crop progress and conditions report, U.S. corn conditions improved slightly to 58 percent good-to-excellent vs. 58 percent expected, 57 percent the week prior and 67 percent last year. Only 81 percent of the crop has reached the dough stage vs. 93 percent on average. That leaves 17 million acres of corn not in dough stage yet. 41 percent has reached the dent stage vs. 63 percent on average.

Strategy & Outlook

Harvest data will be key for the markets and price direction. Early yields should be the best of the year.

Soybean

Soybean closed the week ending Sept. 6 at 11 cents lower. Private exporters announced sale of 451,766 mts of soybeans to Mexico for 2019-20.

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In the weekly export inspections report, U.S. soybean exports for the week ending Aug. 30, the last full week of the 2018-19 marketing year, were very strong at 47.1 million bushels, up from the previous week's 35.5 million bushels and notably above last year's same-week exports of 28.5 million bushels. China aggressively loaded soybeans in the last week of the marketing year, with 28.6 MB shipped and would leave roughly 36.4 MB of soybean on the books to carry over to 2019-20. USDA's old crop sales forecast of 1.700 BB should easily be hit and may need to be adjusted slightly higher. U.S. soybean crush in July was reported by USDA at 179.5 million bushels, slightly above the average trade estimate of 178.5 million bushels and up sharply from June crush of 157.6 million bushels as well as marginally above last year's July crush of 178.9 million bushels. This reflects a new record for the month of July. In the weekly crop progress and conditions report, U.S. soybean conditions remain unchanged at 55 percent good-to-excellent vs. 56 percent expected, 55 percent the prior week and 66 percent last year. 86 percent is setting pods with 96 percent of the crop blooming. That leaves 10.7 million acres of soybeans yet to set a pod.

Strategy & Outlook

October meetings would be the perfect time for the U.S. and China to reach a trade agreement.

Live & Feeder Cattle

For the week ending Sept. 6, live cattle closed $3.65 lower while feeder cattle closed $.57 higher. Fed cattle trade in the north was mostly $101 to $103 live and $165 to $167 dressed – $3 to $8 lower than the prior week. Trade in the south was primarily $100 – $3 softer versus last week. The Fed Cattle Exchange online auction saw 847 head offered for sale. 335 head sold from three lots in Nebraska at $103. The latest USDA steer carcass weights were up 3 pounds versus the prior week at 884, making them 5 pounds less than last year. Net beef sales of 18,100 MT reported for 2019 were up 31 percent from the previous week and 5 percent from the prior 4-week average. Beef exports in July were down 5.8 million pounds or 2.1 percent compared to July 2018. Year-to-date, exports are 2.7 percent below a year ago.

Strategy & Outlook

News that the Holcolm, Kan., plant will remain closed until January is a bearish development.

Lean Hogs

Lean hogs closed the week ending Sept. 6 at 42 cents lower. Iowa and southern Minnesota weekly hog weights came in at 278.3 lbs. vs. 277.4 lbs. the previous week and 276.6 lbs. last year. Net pork sales of 17,700 MT reported for 2019 were down 38 percent from the previous week and 13 percent from the prior 4-week average. U.S. pork exports for July totaled 542.15 million tonnes, the second highest on record dating back to 2000. Highest month was 547.931 from April, 2018. U.S. pork exports to China in July totaled 107.91 million pounds, the third highest on record. Highest was 117.76 million in November, 2011, the second highest was 108.58 million in October, 2011.

Strategy & Outlook

Producers should have moved all risk to the cash markets.

Brian Hoops is president and senior market analyst of Midwest Market Solutions Inc. The home office is in Springfield, Mo., with branch offices in Thief River Falls, Minn.; Verona, N.D.; Yankton, S.D.; Storm Lake, Iowa; and Springfield, Neb.

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