TFM Sunrise Update 7-23-20


Corn futures were mostly steady overnight while holding the upper area of the past two days’ trading ranges.  Dec corn has found nearby support at 3.30 and is currently trading as high as 3.35-1/4 ahead of this morning’s USDA Weekly Export Sales that are expected to come in between 1.90 and 4.00 million metric tons combined for old and new crop.   Rumors of China looking for U.S. corn and wheat supported the market on Wednesday aided by a weaker dollar, which was down again overnight.  China is also undergoing epic flooding that has now impacted their row crop growing areas.  In the U.S., the radar is not showing any echoes of rain in the corn belt this morning and weather is deemed non-threatening overall during this seasonal window for lower corn prices.


Soybean futures rose 3 to 4 cents overnight along with the rest of the complex.  USDA reported export sales for the 8th consecutive day on Wednesday and we wouldn’t be surprised to see another round today.  Weather has turned bearish, but demand has supported prices.  Weekly export sales are expected to range between 1.3-2.7 MMT of soybeans combined old and new crop.  Nov beans are once again knocking on the door of the $9.00 price level having reached 8.99-1/2 overnight and closing above the contract’s 10-day moving average each of the last four sessions.


Wheat futures were mixed overnight.  Rumors of China purchasing U.S. wheat fueled price gains on Wednesday and with the downward-trending U.S. dollar creating a more competitive market environment, prices should remain range-bound at worst.  Global wheat prices remain firm, but over global supplies will cap significant buying interest.  Weekly export sales are expected to range from 300-600,000 mmt.


Live cattle futures are expected to see early two-sided action.  Cash was still developing on Wednesday, with more trade at $96,  steady to firmer from last week.  USDA cold storage data showed total pounds of beef in freezers up 3% from last month and 6% over last year, which could weigh on prices.  The following are analysts’ estimates for the monthly Cattle on Feed report, which is due on Friday at 2 p.m. CDT; Cattle placements and marketings in June rose from a year earlier, analysts said, as slaughtering recovered from plant closures and slowdowns caused by outbreaks of the coronavirus among meatpacking workers in April.  Feedlot returns are expected to be positive for cattle placed in June, encouraging full pens, according to the Livestock Marketing Information Center.


Lean hog futures are called mixed.  Weak afternoon retail values will pressure prices, but the current retail carcass value is at its highest levels since June.   America’s frozen pork inventories were down 25% from a year earlier at the end of June, the USDA said on Wednesday, after outbreaks of the coronavirus among meatpacking workers slowed production.  There were 464.373 million pounds of pork in cold-storage facilities on June 30, down from 467.927 million the previous month and 619.454 million a year earlier.  Weekly export sales today may help dictate the direction for prices on Thursday.


Matthew Strelow

Sign up to get daily TFM Market Updates straight to your email!

back to TFM Market Updates