CORN

Corn futures are looking at a mixed start for today after trading mostly unchanged overnight with Dec again staying close to the psychological 3.50 price level.  A firm close on Monday following a retest of the lows during the session may help attract some addition short covering in the corn market.  The latest commitment of traders report showed funds net short 110,402 corn contracts as of last Tuesday.  USDA made sharp cuts in ethanol demand on last week’s WASDE report reflecting the demand concerns in the corn market but Weekly export inspections stayed supportive, as the U.S. is extremely competitive for global business at these price levels.  In Monday’s USDA Planting Progress update, USDA estimated 3 pct of the US corn crop is planted vs 4 average.  Other market news will help give Ag markets direction.  Newswires report that “The U.S. Department of Agriculture will spend up to $15.5 billion in the initial phase of its plan to bolster the nation’s food supply chain against the impacts of the coronavirus outbreak, according to three sources familiar with the matter”.  More details may come as soon as today, or tomorrow.  Stock index futures are trading 300 points higher this morning.

SOYBEANS

Soybean futures eased 1 to 2 cents overnight after finishing Monday’s outside trading range with a moderate loss.  Nov beans, at 8.68, remain range bound between a nearly 30 cent trading range with 8.87 on the high side and 8.57-1/2 on the low end. The latest commitment of traders report showed funds net long 17,161 bean contracts, 31,547 bean meal; And, 2,708 lots of soy oil as of last Tuesday.  Global export competition is in the minds of the soybean trade and U.S. beans are struggling to compete at the moment while running at a premium to South American soybeans that are aided by a weaker Real versus the dollar.  Weekly export inspections were below expectations, and indicate a long term concern in the soybean market.

WHEAT

Wheat futures were down slightly overnight after failing to maintain gains in yesterday’s trade. May Chi wheat is down 4-1/2 cents to 5.50-1/2.  May KC fell 3 to 4.91; And, May Mpls is off 1-1/2 cents to 5.26.  The latest commitment of traders report showed funds net long 26,165 Chi wheat contracts and 2,102 KC wheat contracts as of last Tuesday.  Cold temperatures forecast for this week across U.S. wheat country provides support regarding possible freeze or frost damage to winter wheat crops.  USDA rated the U.S. 2020 winter wheat crop at a robust 62 percent good- to-excellent, unchanged from last week.  USDA estimated US spring wheat 5 percent planted versus 9 pct average.  Both numbers were expected.  Meanwhile, weather and dryness concerns to Russia’s wheat crop offer support to global wheat prices, helping support U.S. prices in general.

CATTLE

Live cattle are futures called lower.  Limit down closes across the board in Monday’s trade is likely to bring additional follow through amid expanded limits.  Retail values have stabilized the past couple sessions and may limit selling.  Plant closings and labor concerns have slowed the flow of cattle thus creating issues with packing capacity.  This pressures U.S. cash prices as Government officials rush  to deliver Covid-19 testing kits to meat plants and deliver other personal protective equipment to keep plants open and operating at near capacity.

HOGS

Lean hog futures are called steady to lower. The discount of April futures to the Lean Hog Index will keep support in the front month, which closed 2.10 higher.  Processing plant closures are keeping concerns alive regarding the handling of the large supply of slaughter-ready hogs.  We’ll watch the strength in retail values as a price support feature for the market.

Author

Kelly Rubisch