The CME and Total Farm Marketing offices will be closed Monday, February 15, 2021, in observance of Presidents Day.

CORN

Corn futures traded in positive territory overnight led by 4 to 5 cent gains in the nearbys.  March and May corn are trading near 5.45 in between their respective 10 and 20-day moving averages.  For the week, the contracts are slightly lower and about mid-range of their nearly 50 cent trading ranges posted from Tuesday’s high to Thursday’s low.  Dec corn was up 1 to 2 cents overnight in the 4.50 to 4.55 range which is about fair value based on the latest USDA Stocks-to-Use ratio.  The strong price trend that began mid-August and really took off in mid-December remains intact as many traders expect USDA to eventually increase China corn imports, lower South America exports and increase U.S. exports. U.S. export commitments to date would suggest final exports could increase 200 to 300 mil bu from USDA latest estimate.  Managed Money is net long an estimated 339,000 corn contracts.

SOYBEANS

Soybean futures traded two-sided overnight and are situated squarely in the middle of this week’s trading ranges as the trade factors in Tuesday’s USDA report and mixed weather conditions in South America.  The USDA is projecting the tightest end-of-season stocks in seven years and the tightest stocks-to-use ratio on record.  May beans were up a nickel to 13.71-3/4 at 5 AM and about 7 cents higher for the week.  Nov was up 3-1/2 cents to 11.77-3/4 and 17 cents for the week.  Look for more rangebound activity until more is known about SA crops, Chinese demand and U.S. planting weather.  Managed Money is net long an estimated 177,000 soybeans; 70,000 lots of soymeal, and; 119,000 soyoil.  Looking ahead, U.S. soybean processing plants likely turned in their third-largest monthly crush on record in January and the largest-ever crush for the first month of the year, according to analysts polled ahead of a NOPA report due on Tuesday.

WHEAT

Winter and spring wheat futures were mixed overnight.  May winter wheat contracts are down a nickel from last Friday’s settlements.  Chicago wheat is fractionally higher to 6.39-1/4 while testing 50-day moving average support seen at 6.32-3/4.  May KC wheat is up 4 this morning to 6.21; And, May Mpls spring wheat is up 4 to 6.31, but down 6 cents for the week.  All in all, sideways movement in the wheat market is reflective of the consolidation taking place in row crops and the dollar.   The neutral tone on the charts is supported by extremely cold temperatures in the U.S. Plains and Midwest lingering into early next week.  Current prices have little weather premium built in.  NOAA suggested this week that La Nina could be peaking which would be viewed a beneficial for U.S. winter wheat crops.  Managed Money is net long an estimated 7,000 contracts of SRW wheat.

CATTLE

Cattle futures are called mixed as prices seek further direction ahead of the weekend.   Demand is good and the technical trend is still higher, but a bearish technical signal on Tuesday is still looming over the top of the market.  Weekly export sales at 17,500 MT were reported yesterday.  Carcasses closed the day at 232.96, down .06 for Choice and Select lost .67 to 220.29 with a load count of 104 loads.  Meanwhile, relatively strong deliveries against the February contract is weighing on the market.  In addition, light cash trade from $113 to $114 is running steady to $1 lower than last week.

HOGS

Lean hog futures are called higher, supported by a positive trend in exports.  Weekly export sales at 36,900 MT featured China as the top buyer.  Carcasses closed 2.01 higher to 88.87 on 336 loads.  The February contract expires today leaving April the lead month contract following a break through resistance to new contract highs on strong technical buying.  The technical strength across the hog complex represents good money flow behind the move, but now technically overbought, caution is warranted.

Author

Matthew Strelow