CORN

Corn futures are trading moderately higher today, retesting some nearby resistance after yesterday’s disappointing close. Mar corn is up 3 cents to 3.82-3/4, May corn is up 2-1/4 to 3.86-1/2, and Jul corn is up 1-1/4 to 3.89-1/2. The USDA left U.S. ending stocks unchanged yesterday, including lowering exports and increasing ethanol usage. Outside markets are mixed today, with crude oil higher which is supportive. Meanwhile, the U.S. dollar is higher and the Brazilian real is once again pushing to new all-time lows. Argentina corn supplies are cheap in the U.S. which will likely keep major export activity quiet. Mar corn tested its 10-day moving average resistance level yesterday but was unable to close above it. Prices have so far pushed through that level today and are testing their overhead 20 and 50-day moving average resistance levels. Prices are still stuck within the months-long range and funds were thought to have sold about 10,000 contracts of corn yesterday.

SOYBEANS

Soybean futures are slightly higher today, with Mar up 4-1/2 cents to 8.89-1/4, May is up 3 cents to 9.00-1/4, and Jul is up 2 cents to 9.12-1/4. With the Brazilian real at all-time lows again and the USDA pushing to new highs for the move, export prospects look bleak in the short term. World ending stocks and stocks usage ratio increased on yesterday’s Supply and Demand report and non-threatening weather in South America is not shrinking crop size though rains are delaying harvest a bit. There was good news today that many China crushers are back online after stoppages due to the New Year holiday, as well as coronavirus. This should increase import demand. Mar beans traded at their highest levels today since January 30 and are just off the highs for the day. Stochastics have turned out of oversold levels into a buy signal with near-term resistance overhead at the 20-day moving average currently at 8.96. Speculative funds were thought to have been net even during yesterday’s session.

WHEAT

Wheat markets are finding a decent recovery bounce this morning, with Mar Chi wheat up 6 cents to 5.48, Mar KC wheat is up 4 cents to 4.72-1/4, and Mar spring wheat is up a penny to 5.32-1/4. Yesterday’s session looked especially negative, with breaks below technical support levels after a neutral to positive Supply and Demand report. Rains in the southern Plains for the next three weeks should improve crop conditions and with the dollar rallying so hard lately, China has been buying lots of wheat from France, Canada, and Australia. Mar Chi wheat closed below its 50-day moving average support level yesterday for the first time since September 26. Prices moved lower to new lows for the correction this morning but have since bounced higher and may retest the 50-day. Mar KC wheat is trading back above its 10 and 50-day moving average levels this morning and Mar spring wheat futures are choppy. Speculative funds were thought to have sold about 10,000 contracts of Chi wheat yesterday.

CATTLE

Cattle markets are slightly higher in early trade today, attempting to stabilize after yesterday’s sharp losses. Feb lives are up 42 cents to 119.50, Apr lives are up 52 cents to 117.70, and Jun lives are up 75 cents to 109.87. Mar feeders are up 45 cents to 135.12 and Apr feeders are up 60 cents to 137.32. Cash cattle traded yesterday down 2.00 from last week and today’s Online Fed Cattle Exchange saw 315 head sold of the 413 head offered at 119.00, steady with yesterday’s trade in the country. Beef values continue to slip due to a surge in beef production and pull back in demand. The USDA also increased Q1 and Q2 beef production yesterday while reducing Q3 and Q4 production. Apr lives traded at their lowest levels today since September 25 though have rebounded and are currently trading in the middle of yesterday’s range. Mar feeders are consolidating near the low end of their recent trading range.

HOGS

Hog markets are mixed to mostly lower this morning, with Feb down 32 cents to 55.80, Apr was down 40 cents to 63.82, and Jun is up 5 cents to 81.02. The USDA increased U.S. pork production estimates for all four quarters of 2020. Though the U.S. has been selling much more pork to China this year than in past years, carcass values are still dipping to their lowest levels since last March. Coronavirus has still not been contained in China which also complicates logistics for Chinese imports. Apr hogs are currently holding their 10-day moving average support level after first breaking through last Friday. Stochastics are nearly oversold once again. Deferred contracts are holding recent gains with a bit more determination and are consolidating within recent ranges.

Author

Carol Tillmann