Weekly Ag Commodities Market Wrap-Up (5/21)


For the week ended May 21, July corn finished up 15 3/4 cents, December corn finished up 3 3/4 cents. July beans finished 60 cents lower for the week, and November beans finished down 40 1/4 cents. Kansas City July wheat closed down 33 3/4 cents, Chicago July wheat closed down 33 cents and Minneapolis new crop September closed 39 1/2 cents lower.


It was a touch and go week for the livestock complex as the market must manage both technical and fundamental influences extremely close in Friday's market. Thankfully, both beef and pork demand continue to run wild and before Friday's close, traders upped their ante and the contracts closed higher. Hog prices closed lower on the National Direct Afternoon Hog Report, down $2.99 with a weighted average of $106.80 on 3,596 head.

From Friday to Friday livestock futures scored the following changes: June live cattle up $2.38, August live cattle up $2.10; May feeder cattle down $0.33, August feeder cattle up $2.55; June lean hogs up $5.50, July lean hogs up $7.55.

Boxed beef prices averaged higher yet again throughout the week and closed above $3.00 per pound in both choice and select cuts on Thursday and Friday afternoon. Throughout the week, choice cuts averaged $323.14 (up $9.08 from last week) and select cuts averaged $299.91 (up $4.64 from last week) and the week's total movement of cuts, grinds and trim only totaled a scant 459 loads.



Class III milk futures came under pressure following the weakness of cheese prices. The June contract fell $1.23 since the close last Friday, ending at the lowest level since March 30. It is interesting to see how futures jumped the following day on March 31 because of the sharp rise of grain prices as a result of the Prospective Plantings report. It was the beginning of trader perception of higher grain prices reducing milk production and tightening milk supply. That has been generally correct, but it does not happen immediately. Traders just wanted to get in on the ground floor of the price increase. Block cheese price actually declined on that day. The sharp gains of the following two weeks pushed June futures $2.19 higher. The market has now nearly eliminated all of that gain. Milk production in April was strong with an increase of 3.3% in the country. There were seven of the top 24 states that showed a decrease in milk production from a year ago. Florida declined 5.3%, Vermont declined 2.7%, Virginia declined 2.3%, Washington declined 1.4%, Utah was down 1.1% and Pennsylvania was down 1.0%. The strongest gain was seen in South Dakota with an increase of 13.4% followed by Indiana with an increase of 11.4%. The top two states of California and Wisconsin increased 4.1% and 4.6%, respectively.


For the week, cheese prices took a large hit. Blocks fell 15.50 cents with 33 loads traded. Barrels fell 12.25 cents with 46 loads traded.


For the week, butter declined 0.50 cent with 15 loads traded. Grade A nonfat dry milk price declined 0.25 cent with 13 loads traded.


July crude oil jumped $1.64, closing at $63.58 per barrel. The Dow gained 124 points, closing at 34,208, while the NASDAQ declined 65 points, closing at 13,471.

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