MARKET TREND Mostly lower CZ down 2, SF down 2, WZ steady

HIGHLIGHT

·       MARKET TREND—Mostly lower: CZ: down $.0125; SF: down $.0175; WZ: steady; KWZ: down $.0025. 

·       MACRO.  Stocks are firmer as the market acknowledges the strong tech sector performance, although trading is light.  ASIA—Higher: Nikkei, +0.70%; Shanghai, +0.53%; Hang Seng, +1.91%.  EUROPE: Higher: DAX, +0.59%; FTSE, +0.28%; CAC, +0.52%.  WALL STREET—Futures are higher—DOW, +81 S&P, +7.25; NAS, +21.75.  EXTERNALS: $ Index:+.043 @ 94.040; Gold: +$4.00 @ $1,278; Jan crude: +$0.23 @ $56.65/bl. 

·       T-storm Weather: Scattered showers & thunderstorms in central Argentina shift northward today, followed by a few more thunderstorms in central & northern areas Thu.-Fri.  Additional rain follows in at least northern areas once a warmer period begins next week.  Although rainfall improves soil moisture, more would be ideal given below-normal totals of late.  In Brazil, multiple cool fronts trigger heavy thunderstorms over the next two weeks as near- and above-normal rainfall amounts continue

·       CZ, dn $.0125 @ $3.4275; CH, dn $.015 @ $3.55.  Funds bought 3 K on Monday  

·       SF, dn $.0175 @ $9.8825; SH, dn $.0175 @ $9.995.  Funds: Even SB, bought 2 SBM and sold 7 SBO 

·       WZ, steady @ $4.22; WH, dn $.0025 @ $4.3825.  The funds sold 4 k on Monday    

CORN/SORGHUM

·       U.S. corn harvest is 90% v. 96% last year and the 5-year avg. of 95%

·       T-storm Weather: Generalized rainfall of 0.67”-1.33” occurs across northern corn growing areas of Argentina into early next week, tapering to 0.50”-1.00” in central areas and lesser amounts south.  Normal amounts are ~1.33”

·       Consultant: Brazil corn production estimate for 2017/18 is unchanged this week at 88.0 MMT vs. 98.5 MMT last year

·       ATI Research: Updated ending stocks estimate for 17/18 U.S. corn 2.511 bbu versus November USDA est. of 2.487

·       U.S. sorghum harvest progress is 90% vs. 93% last year and the 5-year avg. of 92%

SOYBEANS/WHEAT

·       U.S. soybean harvest is 96% vs. 98% last year and behind the 5-year average of 97%

·       ATI Research: Updated ending stocks estimate for 17/18 U.S. soybean 0.444 bbu versus November USDA est. of 0.425

·       T-storm Weather: Widespread rainfall of 2.50”-5.00” across all soybean areas of Brazil except central and southern Rio Grande do Sul over the next two weeks maintains and increases soil moisture across a wide area

·       Consultant: Brazil soybean production est. for 2017/18 is steady this week at 107.0 MMT vs. 114.1 MMT last year

·       U.S. winter wheat crop condition ratings peg Good/Excellent at 52% vs. 54% last week and v. 58% last year

·       T-storm Weather: Light rain returns to parts of Australia later this week and next week to slow wheat harvesting

ENERGY

·       Higher: CLF18, +$0.23 @ $56.65; EBF, +$0.17 @ $62.39; EBF-QCLF, -$0.06; RBZ, +.0114; NGZ, -.018; HOZ, +.0045

·       A mixed trend was noted in cash ethanol markets on Monday: Chicago is quoted at $1.38, down up $0.0125; Basis to Chicago—New York, +10; Gulf, +5 ½; Dallas, +5; Tampa, +19 ½; and LA, +17 ½

·       Ethanol RINs gained on Mon.: 2016’s added 2 ¼ to 88-90; 2017’s up 1 ¾ to 89-91; & 2018’s firmed 1 ¾ to 88 ½-90 ½

·       The Dec RBOB/Dec ethanol spread is trading at +$.3492/gallon 

  LIVESTOCK/POULTRY                     ​;                

·&nb​sp;      Choice boxed beef values declined $1.06 on Monday to $206.18.24, and are $6.63 lower compared to last week

·       5-Area Weekly Weighted Average Steer price dn $3.36 v. last week at $119.35/cwt, but is $11.44 higher v. last year

·       USDA mandatory pork carcass cutout value increased $1.75 on Mon. to $81.78, and is $1.30 higher vs. a week ago 

·       Current nearby board hog crush value is $37.34/cwt vs. last week’s $40.62, last month’s $39.32 & last year’s $24.58

Sources: Bloomberg, Dow Jones, AP, DTN, T-storm Weather

 

 

Brian Basting 
mail to: bbasting@advance-trading.com 
http://www.advance-trading.com

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