The latest Market Talks covering Commodities. Published exclusively on Dow Jones Newswires throughout the day.
1503 ET - Livestock futures on the CME settled lower for the day, with live cattle and lean hog futures tumbling as the day progressed. For both contracts, the main push lower is stagnant consumer demand for beef and pork, the Hightower Report says in a note. Cutout prices for both are weaker, even though the Labor Day holiday is fast approaching, which is typically the last day of the grilling season in the U.S. Live cattle futures finished trading down 1.6% to $2.203 a pound, while hogs closed down 1.7% to 82.175 cents a pound. (kirk.maltais@wsj.com)
1459 ET - Crude futures settle lower after a string of gains with the U.S. and Iran both claiming to have control over the strategic Strait of Hormuz. "The stalemate in crude price movements comes at a time when we see no horizon for a return of constructive diplomatic momentum or a return to broad escalation, at least in the very short term," XS.com senior market analyst Samer Hasn says in a note.That will keep the region "in a state of no peace and no war," he says, with the possibility of major escalation keeping the risk premium high. The IEA's and OPEC's lowering of their demand forecasts, and the unexpectedly large build last week in U.S. crude inventories, could prevent sharp rises in oil prices, he adds. WTI settles down 2.4% at $81.25 a barrel and Brent falls 2.1% to $87.07. (anthony.harrup@wsj.com)
1445 ET - U.S. natural gas futures retreat after the EIA reports an above-estimate 36 Bcf weekly inventory build, extending the storage surplus to 198 Bcf from 195 Bcf, despite hot weather spurring high electricity demand. "What made today's EIA report probably sting a little more was optimism power burns have tightened over the past 1-2 weeks, which the EIA report suggested wasn't the case," NatGasWeather.com says in a note. "And it hasn't helped that wind energy generation has been strong the past few days when demand has been strong," including across Texas, the forecaster adds. Nymex natural gas settles down 2.7% at $2.727/mmBtu.(anthony.harrup@wsj.com)
1228 ET--Russian news agency Interfax is reporting that the country has not received any formalized moratorium regarding the Russia-Ukraine conflict - this despite a call from Turkey's foreign minister for the two sides to agree to a temporary pause in the bombing. News of no resolution to the conflict on the horizon could mean that Russian and Ukrainian ports could continue to suffer damage from drone strikes and other military actions, limiting the amount of grain exports that can travel through sea shipping channels. Most-active CBOT wheat futures are down 0.2%, while corn is down 1.7% and soybeans rise 0.1%. (kirk.maltais@wsj.com)
1227 ET - Fertilizer prices remain high due to the logistical nightmare introduced by the U.S.-Iran war and blockade of the Strait of Hormuz - which pushed fertilizer prices back up to levels near where they were at the onset of the Russia-Ukraine war. The elevated prices are expected to stay in place heading into next year, and even as far out as 2028, says agricultural lender CoBank in a note. "Although prices have retreated from the historic highs seen at the start of the war, elevated fertilizer expenses remain a major headwind for the U.S. agricultural sector," says the firm. Many categories of fertilizer have seen prices ease in recent weeks, according to assessments from DTN, but they remain well up from levels seen before the Middle Eastern conflict began. (kirk.maltais@wsj.com)
1142 ET--Brazilian crop agency Conab published its latest forecasts, projecting Brazilian corn at 143 million metric tons. That's up from the previous year, while soybean production totaled 180 million tons, down slightly from last year. Versus USDA projections issued in its WASDE report Wednesday, Conab's corn forecast is roughly 3 million tons higher, while its soybean forecast is essentially the same. "Brazil's Conab delivered a noticeably more bearish corn update than soybean update Thursday," says Jim Wiesemeyer of Ag Bull in a note. According to Wiesemeyer, improvements seen in the safrinha corn crop supported the higher corn figure, and the higher corn figure is likely pressuring CBOT futures Thursday. "The Brazilian government's own field-based estimate being nearly 3 MMT above USDA will be difficult for the market to ignore," says Wiesemeyer. (kirk.maltais@wsj.com)
1117 ET - Investors are continuing to liquidate holdings in live cattle futures, according to AgResource in a note, "and a weaker outlook is offered for early trade today," says the firm. The USDA also reported lower export sales of beef versus the prior week, with 14,400 metric tons sold for the week ended Aug. 6. That's down 27% from the prior week, although up 10% from the prior 4-week average. Live cattle futures are down 0.9% to $2.217 a pound, while lean hogs are off 1.9% to 81.925 cents a pound. (kirk.maltais@wsj.com)
1110 ET - The ongoing El Niño climate system is getting stronger, with the National Weather Service's Climate Prediction Center assessing "a greater than 90% chance of a very strong event during the Northern Hemisphere fall and winter 2026-27," in its latest update. An El Niño system generally means that the winter conditions will be warmer than normal--which may be beneficial for farmers that are proceeding to harvest their fields. If El Niño does end up being as strong as predicted, then it may be the most radical El Niño since at least 1950, says the Climate Prediction Center. CBOT grain futures are mixed, with corn down 1.1%, while soybeans inch up 0.1% and wheat climbs 1.2%. (kirk.maltais@wsj.com)
1106 ET - U.S. natural gas inventories increased more than usual last week, raising the surplus over the five-year average to 198 billion cubic feet from 195 Bcf the week before. Net injections into underground storage facilities were 36 Bcf, putting stocks at 3,153 Bcf, the EIA reports. The storage build was above the 33 Bcf five-year average for the week and bigger than the 30 Bcf expected in a WSJ survey of analysts. Nymex natural gas futures are down $2.2% at $2.742/mmBtu.(anthony.harrup@wsj.com)
1057 ET - Canada's dairy farmers raise a stink over possible agricultural concessions the country's negotiators are prepared to make to the U.S. to secure tariff relief on key industrial sectors. "Our national food sovereignty is not up for negotiation," says David Wiens, head of the influential Dairy Farmers of Canada. "It is imperative that no more concessions on dairy" are made. The Trump administration is set next week to impose 50% tariffs on certain Canadian goods in response to Canada's alleged mistreatment of US dairy products, automobiles and alcohol. Canadian officials say they are unwilling to upend the country's supply-management system, whereby government agencies set dairy prices, enforce production quotas, and limit dairy imports. Canadian and US negotiators are in talks in Washington, to avoid the imposition of new 50% duties. (Paul.Vieira@wsj.com; @paulvieira)
1022 ET--Chili's Big Crispy platform and margarita of the month are giving the Brinker International fast-casual chain a red hot edge over its competitors, said UBS analysts in a research note. The analysts said Chili's has shown a sizable increase in the number of chicken sandwiches sold following the Big Crispy debut with positive feedback on size, price and value relative to fast food. They projected an increase in same-store sales and positive traffic over the fiscal year with Chili's planned menu upgrades, including a revamped kids and dessert menu, and social media marketing.(grace.yoon@wsj.com)
1016 ET - Curbs on diesel demand in some regions due to high prices probably won't be enough to rebalance the market given global supply shortages as the market enters the strongest seasonal demand period, Francisco Blanch of Bank of America Global Research says in a note. "Harvest-related demand growth, low inventories, and ongoing supply outages may outweigh early signs of demand destruction," the commodity strategist says. "Absent a meaningful supply recovery, the diesel market appears poised to stay tight, volatile, and expensive well into next year."
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