Weekly Wakeup: Reports Shift to Meats
Attention shifts back toward livestock in the week ahead after last week’s most notable data issue was the March NOPA soybean crush. It came in record large for the month. At the same time, U.S. exports now equal 100% of USDA’s forecast for the year, with more than 130 million bushels still sold but not yet shipped.
This week, the monthly cold storage report comes from USDA Wednesday afternoon, followed by Cattle on Feed Friday afternoon. Traders expect to see cold storage stocks on the West Coast begin to shrink as the port slowdowns caused by the labor dispute improved when a tentative agreement was announced. Both sides—the union and port management—are expected to ratify the agreement by the 23rd.
The continued large premium of beef over pork at the wholesale level continues to surprise everyone, and traders are still waiting for prices of the two meats to get into closer alignment. The Cold Storage and Cattle on Feed reports could be one catalyst. Otherwise, there’s a good chance retail featuring of pork (and chicken) may cut into beef’s grill space.
Traders will also focus on the weekly Crop Progress and Crop Conditions reports Monday afternoon will be growing in importance as the planting season progresses and lags begin to increase. Export inspections Monday and net export sales Thursday continue to be important weekly measures of progress, as is the Wednesday weekly EIA ethanol production and stocks report.
Midweek, Brazilian truckers and government officials are to meet to ink a deal on fuel prices. If the outcome doesn't satisfy the truckers, additional strikes and/or road closures could ensue. That would be construed bullish for U.S. soybean exports.
