CORN

Corn futures are trading very slightly higher this morning, with July up 0.0075 to 3.2425, September is up 0.0075 to 3.28 and December is up 0.0125 to 3.37. Weather forecasts are less threatening than last week, but funds are still holding a large net short position into the start of summer. Export news has been better lately, with help from the lower US dollar. Yesterday’s Crop Progress report was seen as negative, with G/EX conditions up 4% for the week to 74%. The trade is unsure how to judge US-China trade relations at the moment. July corn futures are still trading in a very tight range, and between their 50-day moving average resistance level and their 10-day moving average support level. Momentum indicators are still pointing slightly lower, though successful tests of nearby support has most looking for more sideways trade. Funds were thought to have sold about 8,000 contracts of corn yesterday.

SOYBEANS

Soybean futures are moderately higher today following additional Chinese purchases despite trade tensions. July beans are up 0.115 to 8.52, August soybeans are up 0.105 to 8.5375 and November beans are up 0.0925 to 8.615. Earlier this week, China asked state-run buyers to pause buying US farm goods. However, the USDA reported a flash sale this morning of 132,000 tonnes of US beans to China. The Brazilian real is trading at its highest level this morning since April 16 which is very supportive, especially when the US dollar is trading at its lowest level since March 17. This week was the first week that soybean conditions were reported on the Crop Progress reports, and G/EX ratings totaled 86%. July soybeans traded above the 50-day moving average this morning for the first time since January 21, but have since fallen back below. Deferred month contracts are trading sharply above the 50-day moving average resistance levels and a close above would be a major technical development. Funds were thought to have sold about 1,000 contracts of soybeans yesterday.

WHEAT

Wheat markets look soft this morning with July CHI wheat down 0.025 to 5.1275, July KC wheat is down 0.0725 to 4.5525 and July MPLS wheat is down 0.0375 to 5.1775. Hot and dry forecasts for the next two weeks in the Plains are not nearly enough to support this morning, and KC wheat futures are actually down the most. Russian crop estimates are beginning to move a bit higher which is bearish. The inability of wheat markets to find support on the sharply lower US dollar is disappointing. Yesterday’s Crop Progress report showed winter wheat G/EX conditions down 3% for the week at 51% which was supportive. July CHI wheat is slightly lower, though still holding nearby support levels. KC contracts have fallen through the 20-day moving average support levels but are holding the 10-day. Spring wheat futures are trading in an inside session between the 50-day moving average support level and the 10-day moving average resistance level. Funds were thought to have sold about 3,000 contracts of CHI wheat yesterday.

CATTLE

Cattle markets are showing moderate losses so far this morning, with June lives down 1.50 to 96.80, August lives are down 0.80 to 98.17 and October lives are down 0.45 to 100.92. August feeders are down 1.45 to 134.67 and September feeders are down 1.25 to 135.95. Cash trade yesterday in Kansas, Nebraska and Texas was quite strong yesterday at 118.00 vs last weeks’ range of 110.00-120.00. Especially in delivery month when the nearby June contract is at a sharp discount to cash, this is supportive. Boxed beef vales are still selling off which may leave many to believe that tightening margins will negatively impact cash trade. June lives opened just below their 100-day moving average resistance level and are currently testing their 20-day moving average resistance level. August feeders are trading in an inside session between the 100-day moving average resistance level and the 20-day moving average support level.

HOGS

Hogs: Hog markets are mixed this morning, with June down 1.35 to 53.25, July is down 0.20 to 54.92 and August lives are down 0.30 to 55.40. Carcass cutout values are still selling off hard, with heavy weights in continually increasing production. Questionable trade relations with China has kept hog traders on the defensive, even though China has bought US soybeans despite allegedly telling state-run buyers to halt purchases. The cash Index is trending lower which will make it tough for the June contract to rally into delivery month despite the discount. June hogs are holding the lower Bollinger Band support level in a fairly tight range. July and August hogs are also trading within quiet ranges, and the August contract is currently testing its 10-day moving average resistance level.

Author

Sam Seid