CORN

Corn markets look weak this morning, with May down 0.00325 to 3.275, Jul is down 0.0375 to 3.33 and Dec is down 0.03 to 3.4775. Most analysts are expecting to see higher U.S. and world ending stocks on Thursday’s WASDE report, due in large part to sharply reduced ethanol grind. Energy prices are down again this morning after a move off the lows late last week which is providing outside pressure. July corn has fallen to new lows for the third session in a row, with momentum indicators still pointing lower. A weekly close, or sharp move, for May below 3.28 opens room for corn to possibly test 3.00. Funds were thought to have sold 10,000 contracts of corn on Friday.

SOYBEANS

Soybeans are slightly higher in early trade today, with May, Jul and Nov all 0.025 higher at 8.5675, 8.62 and 8.65 respectively.  As coronavirus spreads through Indonesia, many are expecting palm oil prices to rally on fears of lower production. South American production estimates are coming down due to heat and dryness, but this same heat and dryness could jump start harvest activities in Argentina. The higher Brazilian real is helping to offset some dollar strength today. July beans are trading just off the highs of the day so far after pushing to new lows for the move early in the session. Todays price action does not constitute a reversal though the action is impressive nonetheless. Funds were though to have sold about 6,000 contracts of soybeans on Friday.

WHEAT

Wheat markets are moderately higher this morning, with May CHI wheat up 0.0675 to 5.56, May KC wheat is up 0.0375 to 4.7575 and May MPLS Wheat is up 0.045 to 5.29. Saudi Arabia and Jordan are both making moves to secure more wheat inventory for strategic reserves, and this has given traders the confidence that governments are still valuing physical grain stocks for food security reasons. Other countries are considering export quotas. Winter wheat contracts are trading near the middle of the day’s range after a test of the 10-day moving average resistance levels this morning. July spring wheat is still trading just below its 10 and 50-day moving average levels. Funds were thought to have bought about 5,000 contracts of CHI wheat on Friday.

CATTLE

Cattle markets are down hard this morning, with April lives down the expanded 4.50 limit to 83.82, June lives are down 2.77 to 78.07 and August lives are down 1.87 to 82.52. May feeders are down 1.10 to 107.00 and August feeders are down 0.25 to 114.17. Cash cattle trade was down 15.00 Friday from the previous week, and April’s continued collapse is pricing in nearly 20.00 more downside for cash in the coming weeks. Beef values are at their lowest levels since mid-March. Even though slaughter is running at relatively normal pace, production is markedly higher due to heavy weights. June cattle opened with sharp losses this morning but are trading in the upper third of the days range so far. Still, the trend is lower.

HOGS

Hog markets are mixed this morning in very volatile trade. April hogs are down 0.72 to 39.50, June is down 0.85 to 47.47 and July hogs are up 0.20 to 52.92.  Pork values are at their lowest levels in over a decade as enormous production coupled with a sharp drop in demand has created massive inventories. The current export pace is very strong, though clearly not strong enough to keep prices out of multi-year lows. The best traded June contract has already traded with a range of 7.25 today. Prices opened down the 4.50 limit but have rallied as high as 51.07. Prices have since settled near the upper third of the day’s range but are still deeply oversold. Today’s stabilization is welcome, but momentum indicators are still pointing lower.

Author

Kelly Rubisch