TFM Sunrise Update 12-13-19


Corn futures continued to tack on gains overnight highlighting a relatively intense second half of this week’s trading. Yesterday’s strong turnaround and excellent export sales news with Mexico stepping in as a large buyer of U.S. corn helped March corn gap higher overnight to a 2-week high of 3.84-1/4 on gains of 6-1/2 cents, which if held, will cap off a weekly reversal from Wednesday’s 3-month low. Mexico’s 1.6 mil ton purchase comes only days after the new U.S./Mexico-Canada agreement was ratified.


Soybean futures rallied 16 cents overnight after gapping higher to begin the overnight session. Despite good export sales reported earlier in the week bean prices had stalled, but shook off yesterday’s losses to close in the upper portion of their trading ranges as the market regains some traction on news of China/U.S. trade relations showing signs of reparations. News that India’s importers are switching from palm oil to sunflower oil supercharged soybean oil, too which is helping the complex as those contracts rally to new highs.


Wheat futures joined row crops into positive territory overnight. Chicago wheat advanced 2 to 4 cents; KC 3 to 5; and, Mpls gained 6 cents on follow through as dryer weather forecasts for the western Plains, as well as dry weather in Australia continue offer support. Short covering was noted yesterday and looks to be a factor again today as the grain and oilseed complex gets a boost from positive trade news.


Cattle futures are called mixed. Prices stagnated the last two weeks and look vulnerable to a drop after consolidating from the latest rally. Weakening cutout values continue to be a major concern and leave the futures market vulnerable to a break to the downside.


Hog futures are called mixed. Renewed optimism that export sales will pick up, potentially a lot, as relations with China improve should provide underlying support. Daily slaughters will likely provide some headwinds, though.


Kelly Rubisch

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