ARC and PLC Enrollment Underway
USDA has announced an enrollment period for the Agriculture Risk Coverage (ARC) and Price Loss Coverage (PLC) programs. Eligible producers can make an appointment with their Farm Service Agency office to sign up between September 3, 2019, and March 15, 2020, to enroll for 2019. Enrollment for 2020 will begin on October 7, 2019, meaning producers waiting until that date can sign-up for two years at once.
Texas A&M University has a decision-making tool that will help farmers analyze payment yield updates and expected payments for 2019 and 2020. The tool can be found at the following address: https://www.afpc.tamu.edu/
Soybean futures continue to chop along in a mostly sideways pattern, with November unable to close above key resistance at $9. Support can be found beginning at $8.80, with longer-term support at $8.50. USDA currently has the average on-farm price for the 2019 crop pegged at $8.50 as well. Weekly export sales were 1.038 million metric tons, within the range of trade estimates. Net sales of 257,000 metric tons to China was particularly supportive. China has issued some tariff waivers ahead of trade talks scheduled for next month, which is expected to result in sales of around 6 million metric tons. However, 19-20 export commitments are 34.5% behind this time last year. The crop is still well behind schedule. Nationwide, 34% of the crop is dropping leaves, compared with a 5-year average of 59%. 54% of the crop is rated good to excellent.
Rice futures tumbled lower early in the week on profit-taking as the recent rally ran out of steam. On Thursday the market rallied to recover some of the losses and moved back above the key $12 level after bouncing off support at the recent low of $11.84. USDA says 58% of the crop is harvested, still a bit behind the 5-year average of 61%. Weekly exports of 39,600 metric tons was reasonable but not enough to spark much buying interest.
Cotton exports remain disappointing and commitments are down 6% from last year at this time. This week’s export sales total was 155,200 bales for 19-20 and 12,800 bales for 20-21, which did little to change the situation. There were no Chinese cancellations this week, which was good news following two weeks in a row with cancellations of over 20,000 bales. December has chart support at the spike low of 56.59 cents, and resistance begins at 63.39 cents.
Corn futures have been working higher after charting a huge bullish key reversal and establishing support at $3.53. However, resistance at $3.80 has caped the market for the time being it seems. Net export sales of 494,000 metric tons this week was disappointing as the range of trade guesses was between 600,000 and 1.1 million. Harvest is getting underway across the country, with 7% harvested as of Sunday.
Volatility in hog futures has been high in recent weeks, but the market has found some strength this week. Cash markets have firmed, as has the pork belly market, and that is providing some support. The upside will likely continue to be limited by the seasonal increase in inventories.
December futures have closed a chart gap between $69.95 and $70.27 ½, but have yet to move above resistance at the recent high of $71.60.
Live cattle futures have continued to strengthen and retrace the losses charted in reaction to the Tyson beef plant fire. December has now closed the first gap to $108.45, and now has an upside objective of $111.17 ½. Packer margins remain extremely high amid the fallout from the fire. The monthly feedlot inventory report provided some support, estimating the total number of cattle on feed on September 1 to be 98.7% of last year’s total. This is the first year to year drop in inventory reported since December 2016.