Clean Energy Futures

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AgMaster 7-30-2019



Supply Bulls vs Demand Bears! However, moderating temps have weakened The Bull’s position while disappointing US/China trade talks have strengthened  the Bears Position – leading to a steady erosion of prices! The August 12 USDA Crop Report should Provide some clarity on the “real” acreage situation!


  1. EXPORTS – Mon inspections were 645,000 (400-700) & Thur sales were 507,000 (250-700)
  2. US/CHINA TRADE TALKS – In Shanghai are off to a shaky start according to the TRUMP TWEETS issued this morning
  3. CROP CONDITIONS – Improved this week (57-58) when they were widely expected to retreat Silking – 58 (avg-83)  Dough – 13 (avg – 23)
  4. MODERATING WEATHER – Not “hot & dry” have stabilized the crop
  5. SOUTH AMERICAN CROPS – With their good crops, have offered the Chinese some alternatives
  6. A STRONG US DOLLAR – since Mid-June has rallied 250 points – and this is not a good thing for grain exports already beleaguered by the trade wars!

There is still much uncertainty surrounding the US Corn Crop – including prevent acres, yield drag & weather anomalies such as “returning hot & dry” & “early frost”! We’re anxious to see the USDA’s 8/12/19 report & their take on corn & beans acres!!


 A $130 rally since early May (805-935) off historic planting delays has given way to a cooler, wetter forecast – forcing a 50 % retracement in price (935-875)!  That’s not unreasonable chart action – and implies the uptrend is still intact– especially with so many variable fundamentals coming “down the pike” – including updated yields & acreage #’s & any weather threats! Even though crop ratings improved slightly last nite, they are still nearly 20% under 2018! Lastly, Bean prices even after their earlier rally, still reside in the bottom one-third of their 10-year range!


The Wht mkt has had some relevant info out in the past week:

  1. Spring Wht’s good/excellent dropped from 76% to 73%
  2. WW is 75% in (avg-86)
  3. Sovecon lowered their 2019-20 Russian Wht production – to 73.7 MMT from 76.6
  4. Algeria purchased 550,000-600,000 MT of Wht

However, key mkt factors really impacting the mkt would be slack exports (US price too high) and its slumping sister mkts – corn & beans – resulting in a 9 cent weekly loss -so far!!


Oct Cat has been the beneficiary of several positive fundamentals of late- a friendly Cattle-on-Feed Report, a much-larger-than-normal 4th-1st Qtr production decrease, the best seasonal demand of the year (barbeque) & a large discount to cash!  But all of that couldn’t hold the mkt up against very disappointing results from the most recent US/China trade talks in Shanghai – resulting in a  mkt plummet – currently $3.00 off its recent highs!



Oct Hogs have plunged to limit-down today on the heals of very poor trade talks in Shanghai – all told, the contract has dropped $11 in only 7 trading days! It simply illustrates the extreme importance exports play to a hog mkt – still over-burdened with supplies! Not only have potential exports off a possible US/China accord dried up but the SARS epidemic in Asia hasn’t translated into additional US exports either – very disappointing!!


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