Rice
After failing to close above resistance at $11 on Sept. 10, November rice futures have rapidly taken over a dollar off the market. Harvest pressure is in full force, with 49 percent of the crop in the bins nationwide. Arkansas farmers have harvested 47 percent of the 2018 crop, well behind their 2017 pace, but right in line with the 5-year average. Record-high global rice supplies are forecast for the 2018-2019 marketing year, mostly due to higher carry-in from the 2017-2018 crop. Rice production for 2018 is forecast to be down slightly as acreage has declined in many rice-producing nations around the world. Global rice trade is also expected to set a record for the third consecutive year, as demand from Sub-Saharan Africa and China continues to grow. U.S. prices haven’t been particularly competitive compared with Asian and South American origins, and U.S. exports reflect that. The USDA supply/demand report shows U.S. rough-rice exports for 2017-2018 at their lowest level since 2000-2001 at 28.6 million cwt, and milled rice exports of 58.4 million cwt were the lowest since 1975-1976. The August stocks report showed a significant decline in the previous estimate, resulting in a positive adjustment to the September supply/demand report — dropping beginning stocks to 29.4 million cwt, but the bottom line was still negative for farmers, with UDSA dropping their average farm price estimate 20 cents on either end to $11.20-$12.20/cwt.

Cotton
After trending sideways for the past month, cotton futures have taken a sharp downturn this week. In the latest production and supply/demand reports, USDA increased the 2018-2019 U.S. production estimate by 447,000 bales, or 2 percent from the August report. That is down 6 percent from 2017-2018 production. The increase was due to an increase of 415,000 acres in the harvested acreage estimate over the August report that outweighed a decrease in the national average yield, which was cut to 895 lbs. per acre. The bottom line didn’t change, however, with USDA still forecasting an average farm price of 70-80 cents/pound. The production total could be revised downward, though, due to significant crop damage in the Carolinas and Virginia in the wake of Hurricane Florence. Harvest pressure will pick up in the next few weeks, as 49 percent of the crop across the cotton belt now has bolls opening.

Corn
USDA surprised almost everybody with its September corn crop estimate of 14.827 billion bushels. That number is 241 million bushels higher than the August forecast and 298 million bushels higher than the average pre-report estimate from those in the trade. The increase is due to an estimated record-high yield of 181.3 bushels per acre, representing record yields estimated for 12 states. Price weakness could continue as harvest ramps up, but demand for U.S. corn is projected to be strong throughout the 2018-2019 marketing year. Export sales for 201-2019 are currently 44 percent ahead of the year ago pace.

Soybeans
USDA delivered a surprise for the market in the soybean crop estimate, too. The September estimate came in at 4.693 billion bushels, up 107 million bushels from the August estimate and 44 million bushels higher than the average pre-report estimate. Record yields are anticipated in 10 states, resulting in a national average yield estimate of 52.8 bushels per acre. Record world supplies and continued trade tensions with China are also impacting futures. U.S. prices have fallen enough to be competitive with Brazil, and we have begun to see the result of that as exports pick up a bit. November futures are trading just above contract-lows, and indicators suggest the market is oversold and due a technical correction.

Livestock
Livestock futures continue to see strength. October lean hog futures continue to lead the rally, charting their highest close since June. Strength in fresh pork prices and profitable packer margins are keeping demand for live animals strong. Slaughter totals have been down as plants in North Carolina have been offline due to the disruption of Hurricane Florence. News that China’s sow herd fell 4.8 percent from in one day was also good news for prices.

Cattle futures have seen strength in recent weeks, but trade this week has been slow to develop ahead of the Cattle on Feed Report. August placements are expected to rise 4.4 percent. Boxed beef is finding pork to be tough competition in the market at present.