TFM Sunrise Update 11-22-19


Corn futures were flat overnight but holding ground for the week. Thursday’s price action was firmer and demand is improving as outlined in yesterday’s Weekly Export Sales number where Mexico stood out as a strong buyer, but the technical picture is still weak. The market will likely stay choppy as December options expire today and traders anticipate First Notice Day scheduled for next Friday. March corn has been flat all week, trading only a 6  cent trading range between 3.76-3/4 and 3.82-3/4


Bean futures were off a penny overnight amid a weakened technical picture that may bring follow through selling. Prices are holding key 62% retracement level of the fall rally, though. Demand has stayed supportive, but improving South American weather will likely limit short term gains. In addition, the ebb and flow of trade rhetoric regarding U.S. / Chinese Phase 1 agreement has been generally a negative element for the marketplace. Look for a defensive posture to continue until something positive develops.


Wheat futures were up 2 to 3 cents overnight and can be viewed as the bight spot in the grain complex., even after closing at the bottom of the trading range of Thursday’s action. Concerns loom  regarding U.S. competitiveness versus strong global supplies and this market may be due for long liquidation after a quick rally. A firmer dollar this week is also noted. Spring wheat was firm overnight, but is sagging on the charts.


Cattle futures are called steady with early two-sided trade expected. Improving cash trade on the week may be countered by a weakening tone to retail values and packer buying interest could intensify as Tyson resumes slaughter operations.

The market will likely stay choppy anticipating this afternoon's Cattle on Feed numbers. Here are the U.S. CATTLE ON FEED ESTIMATES
                   IN YARDS WITH MORE THAN 1,000 CAPACITY
                                                  AVERAGE RANGE OF ESTIMATES
CATTLE ON FEED       November                          101.3       98.2-102.5
PLACED DURING         October                          112.2       96.2-119.0
MARKETED DURING       October                           99.6       99.3-100.1


Hog futures are called mixed. While prices are oversold at these levels and yesterday’s export sales were supportive, charts look technically weak. Concerns regarding the strong drop in retail values Thursday may bring follow through if Thursday’s lows do not hold.


Lisa Heder

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