CORN

Corn futures are pulling back this morning after strong technical action yesterday on report data. May corn id sown 0.03 to 3.2075, July corn is down 0.0375 to 3.185 and Dec corn is down 0.03 to 3.3275. Yesterday’s Supply and Demand data showed heavy supplies for both old and new crop corn, though estimates were smaller than many market estimates. However, there are still some analysts touting a 4.0bbu carry out for this year, and the market may not believe the USDA’s demand numbers. Still, many are expecting planted acres to come down a bit in June due to low corn prices this Spring. South American production numbers jumped from last month, further adding to global supply. July corn closed above its 20-day moving average level yesterday for the first time since March 4 but has fallen back below this morning. July is also testing its 10-day moving average support level and a close below would be the first since May 6. Dec corn has fallen sharply below the 10 and 20-day moving average levels. Funds were though to have bought about 15,000 corn contracts yesterday.

SOYBEANS

Soybean futures are taking moderate losses today after failing to make positive closes on fairly supportive supply and demand data yesterday. May beans are down 0.07 to 8.4225, July beans are down 0.0975 to 8.4225 and Nov beans are down 0.085 to 8.485. The USDA lowered soybean ending stocks by 175mbu in  2020 from 2019, and the stocks to use ratio is expected to decline to 9.4% vs nearly 15% for 2019. World ending stocks for 2020 are expected to come in at a 5 year low. Still, soybeans couldn’t hold onto a small, mid day bounce yesterday, and posted negative closes. The lower Brazilian real is pressuring US soybean prices despite China becoming a more active buyer lately. July beans have fallen back below their 10 and 20 day moving average support levels after unsuccessfully testing the 50-day moving average resistance levels early this week. Momentum may be curling lower and prices could test support levels from mid-March. Funds were though to have sold about 1,000 contracts of soybeans yesterday.

WHEAT

Wheat markets look very soft this morning, with July CHI wheat down 0.13 to 5.015, July KC wheat is down 0.1225 to 4.57 and July MPLS wheat is down 0.0975 to 5.1125. Without much in the way of bullish data on yesterday’s report, wheat futures were not able to attract much in the way of new buying. In fact, world stocks to use is expected to come in this year at a record high 41.2%. Weather for the next two weeks in the US is non threatening, and rains in Europe and the Black Sea region have alleviated most dryness concerns. Both winter wheat markets have fallen below their recent consolidation levels and spring wheat futures have pulled back from their recent uptrend, and are now below support levels. Both the KC and CHI futures are falling to oversold levels. Funds were thought to have sold about 2,000 contracts of CHI wheat yesterday.

CATTLE

Cattle futures are moderately lower today following extremely volatile trade to start the week. June live cattle are down 0.10, August lives are down 1.55 to 100.12 and October lives are down 1.70 to 102.47. May feeders are down 1.10 to 126.20 and August feeders are down 2.20 to 133.60. Slaughter this week is improving over last week and beef prices are still pushing higher to all time record levels. There was also news this morning that China has suspended beef imports from Australia which could benefit the US. Still, cattle prices have put together rallies very quickly and look due for a correction. Expanded limit higher closes yesterday put live markets back in overbought territory. June live cattle are still overbought, and May feeders are still consolidating within yesterday’s session.

HOGS

Hog markets are taking sharp losses so far today, with June down 3.05 to 58.27, July hogs are down 2.57 to 58.90 and August hogs are down 2.20 to 57.92. The cash index is higher again today after a dip during yesterday’s session, and pork values made their first negative close yesterday afternoon since April 15. Daily kill counts are increasing, and this may help to pressure pork prices despite higher demand for slaughter supplies. June hogs are trading at their lowest levels today since April 30, and though prices have relieved their overbought technicals, momentum indicators are pointing increasingly lower. The 20-day moving average level at 56.05 will need to hold as strong support in order to avoid a much larger sell off. July futures are holding their 20-day moving average support while August has been below the 20-day since Monday.

Author

Bryan Doherty