Spot NDM has been quietly stepping lower for the past few weeks, with prices today dropping to the lowest levels since August. Nonfat dry milk futures slumped, with Q2 prices falling to $1.2770, within a penny of the life-of-contract lows. Grain market bulls went hungry today following today’s USDA WASDE report. Though USDA made no changes to the U.S. corn or soybean balance sheets and early calls pointed to a neutral report right off the bat, markets ultimately closed lower. Analysts suggest the market is at a tipping point, with managed money very long corn. Where does it go from here as planting season approaches?
Today’s Highlights from Ever.Ag’s Know Your Markets
- The CME butter market rebounded off its recent lows, climbing to $2.4300 per pound, gaining a nickel. Twelve lots changed hands. Meanwhile, spot NDM lost 2.5 cents and dropped to $1.3000 per pound. Trading was heavy, with 15 lots exchanged. Spot dry whey also decreased, closing at $0.5675 per pound, down two cents, with two loads exchanged. CME cheese had a quiet day after yesterday’s jump, with blocks and barrels each up less than a penny.
- Milk powder prices were mixed at the latest GlobalDairyTrade Pulse event. WMP finished at $4,117 per metric ton, or $1.87 per pound, up 2.4% on a Pulse-to-Pulse basis, but down 0.7% versus Contract 2 at the most recent main auction. SMP closed at $2,835 per metric ton, or $1.29 per pound, down 0.2% compared to the previous Pulse, but up 0.8% from Contract 2 at the latest main event.
- USDA’s February World Agricultural Supply and Demand Estimates report was mostly neutral for US corn and beans, with USDA leaving domestic balance sheets untouched on the month. US corn ending stocks totaled 1.540 billion bushels compared to a consensus call for 1.526 billion. The soybean ending stock estimate of 380.0 million bushels was ahead of expectations for 374.0 million. USDA did cut South American production slightly, reducing global corn stocks by 1.0% and soybean stocks by 3.2% from the previous report. Nearby corn and soybean futures both dipped following the report.
Ever.Ag - The risk of loss trading commodity futures and options can be substantial. Investors should carefully consider the inherent risks in light of their financial condition. The information contained herein has been obtained from sources to be reliable, however, no independent verification has been made. The information contained herein is strictly the opinion of its author and not necessarily of Ever.Ag and is intended to be a solicitation. Past performance is not indicative of future results.
