Market Watch

A strong performance by the top three international markets kept U.S. beef exports on an upward path in August, according to statistics released by the USDA and compiled by the U.S. Meat Export Federation (USMEF). Beef sales to Japan, Mexico and Canada all posted solid gains in August along with a resurgent Taiwan market as overall U.S. beef exports grew 5 percent in volume and 16 percent in value compared to year-ago levels, reaching 105,544 metric tons valued at $563.3 million. For the first eight months of 2012, beef exports are up 1 percent in volume and 10 percent in value to 767,017 metric tons valued at $4.01 billion. The continued absence of the Russian market – closed to U.S. beef and pork products since February – continues to hinder exports. Excluding Russia, U.S. beef exports are up 8 percent in volume and 16 percent in value. “Challenges appear in many forms, including market closures and disruptions, international competition and product oversupply,” said Philip Sen...

Corn prices continue the long retreat from the peak of September 2012, declining to the lowest level since late August 2010. The most recent price weakness reflects both supply and demand considerations, said University of Illinois agricultural economist Darrel Good. “On the supply side, ongoing reports of yields that exceed expectations in many areas suggest that the next USDA forecast of the U.S. average yield will be at least equal and perhaps exceed the September forecast of 155.3 bushels.” Good said that there is still some uncertainty about the magnitude of  harvested acreage that will not be cleared up, at least partially, until the USDA releases the next /Crop Production /report.  Even so, it appears that production will be large enough to result in a sizable buildup in stocks by   the end of the current marketing year. “On the demand side, the partial shutdown of federal government activities leaves a void in the usual flow of weekly data, including export...

A sharp break in old-crop soybean prices and basis means that the market believes that supplies will be fully adequate until the harvest of the new crop begins in six or seven weeks, according to University of Illinois agricultural economist Darrel Good. “For that to be the case, the domestic crush in July and August would have   to be down sharply from the level of crush last year and sharply below the pace in June of this year.” For old-crop soybean stocks at the end of the year to be at a pipeline level   of 125 million bushels, and to accommodate exports of 1.33 billion bushels, the size of the domestic crush for the year ending August 31 will be limited to 1.66 billion bushels. That is 2.5 percent less than the crush in the previous year. Based on estimates from the National Oilseed Processors Association, the  domestic crush exceeded that of last year in each of the first five months of the current marketing year (September 2012 through January 2013). The crus...

Coffee supplies are exceeding demand for the second straight year, according to Volcafe, driving down coffee bean prices. The world’s top producer, Brazil, will harvest a record 57.8 million bags in the 2013-2014 season. Each bag weighs 132 pounds, or 60 kilograms. Market prices on coffee beans have plunged 12 percent in the last two weeks and are headed for the biggest monthly drop since October. [ BusinessWeek ]

U.S. pork exports set new monthly records in October, according to statistics released by USDA and compiled by the U.S. Meat Export Federation (USMEF), reaching 218,132 metric tons valued at $607 million. Export volume was 9 percent above last year and broke the previous monthly record of 217,080 mt set in November 2011. Export value exceeded $600 million for the first time, breaking the previous high ($597.85 million, also from November 2011) by 1.5 percent. For January through October, U.S. pork exports were 3 percent ahead of last year’s record pace in volume (1.875 million mt) and 6 percent higher in value ($5.24 billion). Beef exports also posted solid results in October, with export value ($496 million) increasing 10 percent over last year despite a 4 percent decline in volume (101,447 mt). This was consistent with this year’s January-October pattern, which has seen an 11 percent decline in volume (951,886 mt) compared to 2011 while export value ($4.6 billion) remained 2 per...

Irrigated corn yield potential is predicted to be 2-8% below long-term average, while dryland yield potential in much of the Corn Belt will be moderately to severely reduced, falling 22-67% below normal. To forecast potential production at 12 sites across the Corn Belt University of Nebraska–Lincoln crop experts used a "Hybrid-Maize model" to estimate end-of-season yield potential based on actual weather up to August 27, and historical long-term weather data to complete the season using data from each of the past 30 years. Simulations were run for dryland corn in Iowa, Illinois, and South Dakota, and for both irrigated and dryland corn in Nebraska. Simulations were based on the typical planting date, hybrid relative maturity, plant population, and soil properties at each location. The bottom line is that 2012 irrigated yields will be moderately lower than the long-term averages (2-8% below normal), while dryland corn yield potential in much of the Corn Belt will be mod...

The USDA will release estimates of June 1 corn and soybean inventories on June 29. The level of those stocks will reveal the rate of consumption during the third quarter of the 2011-12 marketing year and the available supply for consumption during the fourth quarter. According to University of Illinois agricultural economist Darrel Good, there is likely to be a wide range of expectations for the estimate. "Based partially on the on-going record strong corn basis, we anticipate that feed and residual use of corn during the third quarter was larger than the estimate for last year's use. If so, June 1 stocks would be near 3.1 billion bushels and use for the year would be expected to exceed the current USDA projection of 4.55 billion bushels. "The June 1 stocks estimates take on a little more importance this year due to the relatively tight year-ending inventories projected for both corn and soybeans, even though more early-harvested corn is expected this year. The su...