CORN

Corn futures were narrowly mixed overnight following a 3-day weekend.  Dec corn is at 3.50 to begin the week.  Firm closes on Thursday may help bring some addition short covering into the corn market aided by Weekly Export Inspections due out at 10:00 AM CT.  The market saw 2.4 million metric tons of corn export sales last week, which was above expectations and a marketing year high.  In addition, the corn market shook off sharp cuts in ethanol demand in Thursday’s WASDE report and carryout coming in above expectations.  Outside markets are mixed, too with the dollar firming off of a new 1-1/2 week low overnight, crude flat/firm and the stock index futures off nearly 300 points.

SOYBEANS

Soybean futures traded two-sided overnight with a 9 cent trading range in most contracts.  We’ll look for firmer trade this morning since, despite the USDA pushing carryout to 480 million bushels and above expectations, soybeans rallied on Thursday.   Private analysts’ estimates and USDA’s reduction of Brazil and Argentina soybean crops spells more optimism of potential export business.  Late last week,  private exporters reported sales of 4.4 million bushels of soybeans for delivery to unknown destinations.  Of the total, 2.2 mil bu is for delivery during the 2019-20 marketing year, which began Sept 1.  The other 2.2 mil bu is for 2020-21 marketing year crop.

WHEAT

Wheat futures traded 5 to 6 cents higher in Chi contracts last night, 7 to 8 higher in KC; And, 4 higher in Mpls.  Private Exporters late last week reported Export Sales of 6 million bushels of HRW wheat for delivery to China.   Of the total, 2 mil bu is for the delivery during the 2019-20 marketing year that began June 1, 2019, and 4 million is for delivery during the 2020-21 marketing year.  The April USDA WASDE raised carryout above expectations on reductions in exports and feed demand.  However, cold temperature forecast for this week across U.S. wheat country provides support regarding possible freeze or frost damage.

CATTLE

Live cattle futures are called mixed as the market confronts many obstacles surrounding supply and demand upended by Coronavirus.  The April Live Cattle futures contract is running a strong discount to the cash market which saw trade this past week from $103.50 to $106/cwt  live.  Late sales moved higher to $106/cwt in Nebraska.  The wide basis will keep buying support underneath the front month future.  The trend of weaker retail values may limit gains in the deferred contracts which closed last week with weekly gains of $3-8/contract.

HOGS

Lean hog futures are called steady to lower.  Poor retail values and cash markets weigh on hog futures which are set to trade at a new daily limit of 3.75 from 3.00.  CME Group Inc said on Thursday it plans the increase and then adjust them annually because of heightened volatility linked to the outbreak of a fatal pig disease in China.  The limit will temporarily expand to 5.50 if any of the front eight contract months settle at the initial limit.  Currently, limits temporarily expand to 4.50 if any of the front three contract months settle at the initial limit.  Meanwhile, carcass values are trading at their lowest point since 2009.  The discount of April futures to the Lean Hog Index will keep the front month underpinned.  Weekly export sales and shipments will be closely watched as an outlet for U.S. pork production.  Weekly export sales were at a marketing year high with 55,900 MT and China purchasing 38,700 MT.  This offers support, but supplies are too heavy.

Author

Lisa Heder