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NOV BEANS

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Carving out a harvest low is an arduous process and 2023 is no exception! Yet, the market has all the ingredients to do so – 4 million fewer planted acres, a resumption of weekly flash 8 a.m. sales to China, very disappointing early yields, a relatively resilient economy & a resurgent crude oil market – enhancing biodiesel demand! As well, global dryness in Australia, N Brazil & Argentina is friendly! This week, Macro factors intervened mid-week as Fed Chairman Powell issued some hawkish remarks about still raising IRs if necessary – which put downward pressure on all commodities! We see bean yields at 48 BPA versus the latest USDA – 50.1 & Pro Farmer’s 50.9 from their tour as we feel the early/late “hot/dry” was underestimated!

DEC CORN

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Much like beans, corn is also in the process of establishing harvest lows – albeit under a different fundamental scenario! Planted acres for corn are up 4 MA & flash 8 a.m. export sales have not really restarted! But the market broke $1.50 mid-summer – reacting to those supply/demand factors as well as a dramatic weather change from hot & dry to cool & wet! We feel that break has discounted the negative supply/demand factors – and the market as well as a whopping $2.00 under the 2022 highs! This vastly improves corn’s export potential – and indeed, the global corn export environment is very healthy as China has bought record amounts of Brazilian corn! Their voracious appetite should soon benefit the US as Brazil's supplies grow thin! And domestic demand for ethanol is quite strong – as crude oil has rocketed up over $20 since June!

DEC WHT

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Dec Wht continues to be victimized by a prodigious influx of cheap Russian wheat from their record crop! As well, exports continue to be scant & the market has strangely NOT benefited from the closure of the Ukraine Grain corridor – as of yet! We feel the old commodity axiom CHEAP PRICES CURE CHEAP PRICES along with a harvest rally from harvest lows soon to happen in corn & beans will coat-tail wht higher! 

OCT CAT

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The amazing juggernaut that is the 2023 Cattle Bull keeps chugging along – fed by very tight supplies into 2024 & supported by enough demand – albeit at record prices! You just can’t pay enough for a good steak! Exports have also been supportive! Even with relatively cheap pork prices, Dec Cat continues to make new contract highs almost every week! This week the market consolidated just off its recent contract highs – in anticipation of the Sept Cattle-on-Feed Report – issued today at 2 p.m. Placements were estimated at 94% & total On-Feed at 98%! Specs will most likely buy a bearish report! 

OCT HOGS

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Strangely, Oct Hogs have not shared the bullish euphoria of Oct Cat – even though pork products are a lot cheaper in the local supermarkets than meat products! However, daily slaughters have been up, exports have been down & the seasonals point south now! The MACRO BOMB laid on all the markets Wednesday by Fed Chairman Powell's hawkish remarks pressured all commodities!  

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