TFM Sunrise Update 1-8-20


Corn futures traded 1 to 2 lower overnight as the market takes the path of least resistance. Trade action is made up of positioning for Friday’s January crop report, which historically tends to create a 10 to 12 cent swing one way or the other. Most market participants are not expecting significant changes on any of the USDA numbers, with a slight bias for friendly. The range of analyst’s estimate for total U.S. corn production is 13.217 and 13.701 bil bushels with a yield of 166.2, bushels per acre, down from the last estimate of 167 BPA. Today, we will get Weekly Ethanol Stats data followed by Weekly Export Sales tomorrow morning. In outside markets, crude spiked to a new high overnight, but has since pulled back and is trading near it’s session low; The dollar is firm.


Soybean futures were off a penny overnight. Some dryness in Brazil is a concern, yet we are not convinced that the condition of the entire combination of Brazil, Argentina and Paraguay planted bean acreage will have much (if any) concern for production. The range of analyst’s estimate for total bean production in Friday’s report is 3.463 and 3.560 bil bushels with a yield of 46.6, bushels per acre, down slightly from the last estimate of 46.9 BPA.


Wheat futures are flat/firm this morning after a an uneventful overnight trade. New news is lacking, and wheat is a commodity that needs favorable news, or at least the perception, to keep prices moving higher. For world ending stocks, traders see wheat stocks at 287.3 mil tons versus 289.5 mil last month.


Cattle futures are called steady to lower with Feb leading yesterday’s drop, closing 75 lower at 126.52. It looks like the cash market will probably trade to at least 123 and upwards of 125 this week, which is impressive given the recent supply.


Hog futures are called mixed. Prices remain volatile, but good export sales and expectations that supplies could tighten into the second quarter provide underlying support. Futures continue to run a big premium to front months, with Jun currently priced at 87.60 and Feb at 69.22.


Carol Tillmann

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