Corn futures were narrowly mixed overnight while taking out Thursday’s session low before moving fractionally higher. Selling pressure yesterday brought prices near the low end of the recent trading ranges, but the fundamental picture has not changed. Cheap corn in Argentina will keep some pressure on the market, but looking back, traders have historically bought dips in this recent range.
Soybean futures were up 3 cents overnight after finding solid support on lower Bollinger bands and moving average levels yesterday. We do not necessarily expect any violent moves ahead of a trade deal. However, with less progress than expected reported from U.S./China trade negotiations and questions about China’s future appetite for soybean imports, we may not see soybeans spring back higher right away.
Wheat futures unchanged overnight with a weaker tone. Yesterday’s pressure attracted end user demand, and with U.S. wheat crop vulnerable to cold weather, we don’t expect much more downside from here at this time. While not the cheapest in the world, U.S. wheat is still competitive and will draw interest on the export front.
Cattle markets are called mixed. Yesterday’s positive closes seem to indicate that traders are expecting positive cash and beef values to close the week. The current rally may be somewhat overextended, though. Meanwhile, we are entering a seasonal period when beef demand slips.
Hog markets are called steady to firmer. While technical indicators may be indicating that a bottom is in, a lack of consistence strength in pork values is making it difficult to consider owning hogs at this point. Questions about exactly how many hogs have been culled in China due to African swine fever have re-entered market chatter which would be supportive.