TFM Sunrise Update 1-31-20


Corn futures traded a 3-1/2 cent trading range overnight inside Thursday’s lower 6-1/2 cent range in the front month contract. The direction of the corn market into today’s trade will likely be dictated by the strength or weakness seen in other grains and oilseeds. Mar contract is moving towards the bottom of the trading range, and with U.S. corn competitive on the global front and a strong cash market, logic tells us this should provide buyer support. However, with the cornonavirus concerns remain a major source of pressure because of doubts that China will be unable to fulfill their 2020 quotas for Ag purchases from the U.S.


Soybean futures attempted to trade higher overnight, but are basically unchanged heading into the end of the overnight session. After eight consecutive down days on Thursday, soybean charts stay weak as the technical picture brings additional long liquidation and money flow into the short side of the market.


Wheat futures are called mixed to firmer. Chi and KC is off a penny or two as of 5:30 AM, but did see some positive trade overnight before drifting lower. Strong close towards the top end of the day’s trading range yesterday, as selling pressure seemed to dry up after the overnight session, may bring some additional short covering and corrective bounce in the wheat market.


Cattle futures are called mixed. Cattle futures are likely to stay choppy on today’s trading session as we move towards USDA cattle inventory numbers. While cattle on feed and feedlot inventory is known through the Cattle on Feed reports, inventory numbers should show a decline in overall cattle inventory for the first time in six years. In short-term fundamentals, cash trade was around the 122.00 level, down 2.00 from last week, while retail values have stayed choppy in this week’s action.


Hog futures are called lower. The majority of hog futures contracts were locked limit down on Thursday, which will bring expanded limits into today’s trade. Additional selling pressure may be noted in the first part of the session as the technical picture looks bleak. The hog market is moving into oversold territory and may be poised for a bounce or at least a potentially volatile session if prices begin to move quickly the other way.


Carol Tillmann

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