Live Cattle Futures Rise While Lean Hogs Fall — Market Talk

March NY world sugar #11 (SBH25) Thursday closed down -0.28 (-1.43%), and March London ICE white sugar #5 (SWH25) did not trade with markets in the UK closed for the Boxing Day holiday.

NY sugar Thursday tumbled to a 3-1/4 month low and settled moderately lower. Sugar prices have been under pressure since last Thursday when India's Food Secretary Chopra said that India may allow sugar exports if there is a surplus once domestic ethanol blending requirements are met. The Indian government currently estimates a sugar surplus of about 1 MMT this season.

Sugar prices have also been undercut by the weakness in Brazilian real (^USDBRL), which encourages export selling by Brazil's sugar producers. The real is just above last Wednesday's record low against the dollar.

An improved global supply outlook is undercutting sugar prices. On November 21, the International Sugar Organization (ISO) reduced its 2024/25 global sugar deficit forecast to -2.51 MMT, compared to an August forecast of -3.58 MMT. ISO also raised its 2023/24 global sugar surplus estimate to 1.31 MMT from an August projection of +200,000 MT.

The outlook for higher sugar production in Thailand is bearish for sugar prices. On October 29, Thailand's Office of the Cane and Sugar Board projected that Thailand's 2024/25 sugar production would jump by +18% y/y to 10.35 MMT. Thailand produced 8.77 MMT of sugar in the 2023/24 season that ended in April. Thailand is the world's third-largest sugar producer and the second-largest sugar exporter.

Reduced sugar output in India is supportive of prices. The National Federation of India Cooperative Sugar Factories Ltd reported Monday that India's sugar production from Oct 1-Dec 15 fell -18% y/y to 6.1 MMT.

Sugar output from Brazil's Center-South has recently declined, which is a bullish price factor. Unica reported last Thursday that cumulative 2024/25 Center-South sugar output through November is down -3.7% y/y to 39.361 MMT.

Drought and excessive heat earlier this year caused fires in Brazil that damaged sugar crops in Brazil's top sugar-producing state of Sao Paulo. Sugar cane industry group Orplana said that as many as 2,000 fire outbreaks affected up to 80,000 hectares of planted sugarcane in Sao Paulo. Green Pool Commodity Specialists noted that as much as 5 MMT of sugar cane may have been lost due to the fires. Conab, Brazil's government crop forecasting agency, cut its 2024/25 Brazil sugar production estimate from November 21 to 44 MMT from a previous forecast of 46 MMT, citing lower sugarcane yields due to drought and excessive heat.

In a supportive factor for sugar prices, India's Food Ministry on August 30 lifted restrictions on sugar mills producing ethanol for the 2024/25 year that starts November, which may prolong India's sugar export curbs. Last December, India ordered sugar mills to stop using sugarcane to produce ethanol for the 2023/24 supply year to boost its sugar reserves. India has restricted sugar exports since October 2023 to maintain adequate domestic supplies. India allowed mills to export only 6.1 MMT of sugar during the 2022/23 season to September 30 after allowing exports of a record 11.1 MMT in the previous season. However, on October 3, the Indian Sugar and Bio-energy Manufacturers Association (ISM) said India will have 2 MMT of sugar to export next season and urged the government to lift its current sugar export restrictions.

The Indian Sugar and Bio-energy Manufacturers Association (ISM) on September 26 projected India's 2024/25 sugar production would fall by -2% y/y to 33.3 MMT and that India's 2023/24 sugar reserves will be at 8.4 MMT on September 30, compared with a May projection of 9.1 MMT.

As a supportive factor for sugar prices, the International Sugar Organization (ISO) on August 30 forecasted 2024/25 global sugar production of 179.3 MMT, down -1.1% y/y from 181.3 MMT in 2023/24.

The USDA, in its bi-annual report released November 21, projected that global 2024/25 sugar production would climb +1.5% y/y to a record 186.619 MMT and that global 2024/25 human sugar consumption would increase +1.2% y/y to a record 179.63 MMT. The USDA also forecasted that 2024/25 global sugar ending stocks would decline -6.1% y/y to 45.427 MMT.

On the date of publication, Rich Asplund did not have (either directly or indirectly) positions in any of the securities mentioned in this article. All information and data in this article is solely for informational purposes. For more information please view the Barchart Disclosure Policyhere.

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Wheat futures rise amid expectations of tight world supply in thin holidays trade. Russian exports of wheat are likely to decline sharply in the 2025/26 season, Black Sea grain consultancy SovEcon projects. The forecast, released earlier this week, calls for 36.4 million metric tons of Russian exports, down from 43.7 million tons in the current season. "This reduction is attributed to lower carry-in stocks and a projected decrease in wheat production," SovEcon says, adding that domestic feed wheat consumptions in Russia has increased due to poor barley and corn harvests. On the CBOT, the March contract for wheat, soybeans and corn rise more than 1%. (paulo.trevisani@wsj.com; @ptrevisani)

Cotton futures are steady to 4 points higher so far on Thursday. The outside markets are mixed factors, with the US dollar index down 38 points and crude oil $0.19/barrel higher.

The Seam reported 441 bales of online sales on December 24 at an average price of 58.80 cents/lb. ICE cotton stocks were unchanged on Tuesday, at 20,113 bales of certified stocks. The Cotlook A Index was up 130 points on 12/24 at 79.60 cents/lb. The USDA Adjusted World Price (AWP) was cut by another 113 points last week to 55.09 cents/lb. It will be updated later today.

Mar 25 Cotton is at 68.78, unch

May 25 Cotton is at 69.88, unch

Jul 25 Cotton is at 70.89, up 4 points

On the date of publication, Austin Schroeder did not have (either directly or indirectly) positions in any of the securities mentioned in this article. All information and data in this article is solely for informational purposes. For more information please view the Barchart Disclosure Policyhere.

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Live cattle futures are posting $1.70 to $2.30 gains across the front months on Thursday. Cash trade has yet to begin this week, with bids of $190 reported so far. This morning’s Fed Cattle Exchange online auction from Central Stockyards showed no sale on the 1,036 head listed, with bids running $188-190. Feeder cattle futures are up $2.87 to $3.80 in the nearbys at midday. The CME Feeder Cattle Index was down 4 cents from the day prior at $262.96 on December 23.

USDA wholesale Boxed Beef prices were higher in the Thursday morning report. Choice boxes were up $3.84 to $319.82/cwt and Select 98 cents higher @ $287.73.

Dec 24 Live Cattle are at $192.500, up $1.700,

Feb 25 Live Cattle are at $189.450, up $2.075,

Apr 25 Live Cattle are at $191.850, up $2.300,

Jan 25 Feeder Cattle are at $258.725, up $2.875

Mar 25 Feeder Cattle are at $258.800, up $3.800

Apr 25 Feeder Cattle are at $259.350, up $3.500

On the date of publication, Austin Schroeder did not have (either directly or indirectly) positions in any of the securities mentioned in this article. All information and data in this article is solely for informational purposes. For more information please view the Barchart Disclosure Policyhere.

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The wheat market is trading with gains on Thursday’s midday across all three markets. Chicago SRW futures are up 8 to 9 cents on the session. KC HRW contracts are 9 to 10 cents lower across the nearby contracts. MPLS spring wheat futures are 6 to 7 cents in the green on midday.

Algeria purchased 1.17 MMT of wheat in a tender on Tuesday, revised up from the initially reported 630,000 MT. Russia’s IKAR estimates the country’s wheat exports for 2025/26 to fall to 41 MMT, with expectations of the county’s market share to drop from 25% to 20%.

Mar 25 CBOT Wheat is at $5.43 1/2, up 8 3/4 cents,

May 25 CBOT Wheat is at $5.54, up 8 3/4 cents,

Mar 25 KCBT Wheat is at $5.53 3/4, up 10 cents,

May 25 KCBT Wheat is at $5.61 1/4, up 9 1/2 cents,

Mar 25 MGEX Wheat is at $5.96, up 6 1/2 cents,

May 25 MGEX Wheat is at $6.03 3/4, up 6 cents,

On the date of publication, Austin Schroeder did not have (either directly or indirectly) positions in any of the securities mentioned in this article. All information and data in this article is solely for informational purposes. For more information please view the Barchart Disclosure Policyhere.

• Navigating Uncertainty: What I'm Watching In The Grain Markets To Wrap Up 2024
• Merchandiser Insights: Understanding What Basis Moves Are Saying About Supply And Demand In Grains
• Are Soybeans As Bearish As Advertised?
• The "Yeah, but" Problem: What’s Holding The Grain Markets Back?

Lean hog futures are trading mixed so far on Thursday, with contracts up 12 cents to 35 cents lower at midday. The national average base hog negotiated price was reported at $79.10 on Thursday morning. The CME Lean Hog Index was reported at $84.35 on December 19, up 14 cents from the previous day.

USDA’s FOB plant pork cutout value was $1.31 higher in the Thursday morning report at $95.93 per cwt. The picnic and belly primals were reported lower, with the rest up $1.72 to $3.78.

Feb 25 Hogs are at $84.375, unch,,

Apr 25 Hogs are at $89.300, up $0.125

May 25 Hogs is at $92.900, down $0.350,

On the date of publication, Austin Schroeder did not have (either directly or indirectly) positions in any of the securities mentioned in this article. All information and data in this article is solely for informational purposes. For more information please view the Barchart Disclosure Policyhere.

• Where are Animal Protein Prices Heading as the Offseason for Demand Approaches?
• Where are Animal Proteins Prices Heading in Q3 and Beyond?
• Can the Meats Rally During the Peak Season in 2024?