CORN

Corn futures were up 4 to 5 cents overnight on spillover strength from double-digit gains and new highs in beans and a drop in the dollar.  Dec corn, at 4.20 is plotting a higher course above it’s 10 and 20-day moving averages in a bid to take out the contract high from last week at 4.28.  Talk of higher demand for U.S. corn exports and uncertain weather in Ukraine, south Brazil and east Argentina due to La Nina offer support.  Brazil’s second corn crop may be planted late which could help demand for U.S. corn exports.  Meanwhile the lower U.S. corn carryout has prices ticking higher to increase U.S. 2021 corn acreage.  U.S. Corn harvest is 95% complete versus 96% estimate and 87% average.

SOYBEANS

Soybean futures rallied to new highs overnight on gains of 16 cents. Jan beans now have a new contract high at 11.69-1/2, and Dec soyoil hit a new high of 37.93.  Record U.S. NOPA soybean crush topped all trade estimates and upheld the trend amid talk of an increase in Chinese demand.  2021 weather and the size of South America’s crop are focal points as the market exhibits price discovery toward $12 per bushel and possibly beyond.  The latest South America weather forecast in last evening’s GFS model run was notably wetter in central and southern production areas of Argentina for Nov. 26 through Dec. 1.  In Brazil, central west and central south production areas will start to trend drier after Wednesday which will benefit fieldwork advancement; though, greater rain will then be needed; the far south will be driest in week 1 of the outlook; however, this area will then be wetter in week 2.  Overseas tender activity shows Iran seeking 60,000 tons of optional-origin soymeal; Egypt seeks optional-origin soy and sunoil.  U.S. Soybean harvest 96% complete versus 96% estimate and 93% average.

WHEAT

Wheat futures traded narrowly mixed overnight after becoming technically oversold last week and then closing on a positive tilt yesterday.  Surging row crops and a weaker dollar champion support for wheat today as complex as the trade awaits fresh market-moving news.  Bullish wheat traders have little to work with since Chinese demand for grains mean more for corn and beans than wheat at this time.  As a weather market, talk of increased chances for rain in Russia create some headwinds, too.  U.S. winter wheat plantings were 96% complete versus trade estimates of 97% and 94% average.  Winter wheat conditions are 46% good-to-excellent versus trade estimates of 46%, 45% last week, 52% a year ago.

CATTLE

Cattle futures calls are mixed based on the market’s attempt to find traction on Monday following Friday’s disappointing day.  As expected, cash trade was undeveloped on Monday with unestablished bids and asks.  Expectations are for steady to higher again this week.   Carcass values stayed in their uptrend, closing .97 higher on choice to 226.95 and 2.89 higher in Select to 212.35 on moderate demand.  The technical trend in cattle is higher but may be poised to check support levels.  Strength in outside markets with vaccine hopes supported equity markets ushers in buying strength to cattle market at times.  Feeder cattle finished mostly higher with strength in Live cattle, but firming grains limited gains.  We’ll get the next Cattle on Feed report this Friday. 

HOGS

Lean hog calls are steady to weaker amid heavy pork production and large slaughter runs limiting upside potential in hog markets. Estimate slaughter was at 490,000 on Monday.  The technical trend is lower in hogs as heavy pork supplies weigh on the market.  The CME Lean Hog Index was lower on Monday, down .48 to 70.48, though holding a premium over December futures, and supporting that front month.  Retail values closed 1.01 higher to 81.15 to 80.14.  The load count was 346 loads, on some value buying at this price level.  The Chinese Ministry of Agriculture estimated its hog herd grew 27% year-over-year in October, and the sow herd rose by 31.5%.

Author

Matthew Strelow