TFM Midday Update 7-14-20

CORN

July unchanged @ 3.34, September unchanged @ 3.2875, December unchanged @ 3.365
Non-threatening weather forecasts
Crop conditions came in @ 69% G/EX vs 70% expected
US supplies are cheap on world export markets
December corn tested the 50-day moving average resistance level early in the session but could not break through
Lack of rebound after sharp pressure lately is worrying
Funds sold about 32,000 contracts yesterday

July down 0.15 @ 8.765, August up 0.045 @ 8.785, November up 0.03 @ 8.7825
Hot and wet forecasts through July look beneficial for beans, though August weather will be the key
Conditions were reported yesterday @ 68% G/EX vs 70% last week (up 6% from the 10-day average)
Strong demand tone from China
November beans held the 50% retracement of the contract lows and July highs at yesterday’s close
November futures are currently testing the 20-day moving average resistance level
Funds sold about 12,000 contracts yesterday

Dec CHI wheat up 0.0625 @ 5.375, Dec KC wheat up 0.0425 @ 4.65, Dec MPLS wheat up 0.0275 @ 5.3475
Egypt is tendering for wheat this week and Russian prices appear the lowest
KC wheat harvest is starting to wrap up but CHI still has a ways to go
Spring wheat conditions came in @ 68% G/EX vs 70% last week
European futures have pulled back from overbought levels
CHI, KC and MPLS futures are all consolidating within recent ranges
CHI futures are overbought according to stochastics
Funds sold about 7,000 contracts of CHI wheat yesterday

August lives down 0.40 @ 99.25, October lives down 0.90 @ 103.30, December lives down 0.80 @ 107.57
August feeders up 0.05 @ 137.10, September feeders down 0.35 @ 137.25
Beef values are at the lowest levels since October 2018
Production increase from Q2 to Q3 is expected to be a record
Slower than expected restaurant reopenings
August lives are testing the 10-day moving average support level, a close below would be the first since June 26
August feeders are trading in a tight, two-way range so far and are still overbought

July hogs up 0.10 @ 46.77, August hogs up 0.30 @ 51.57 and October hogs up 0.35 @ 50.70
Cash fundamentals are still choppy due to quickly accelerating production
Export pace will need to remain strong in order to carve out a bottom
August hogs made their first close yesterday above the 20-day moving average resistance since June 9
Prices tested the 20-day moving average level as support and are now trading at the highs of the day
October hogs are in more of a consolidation pattern and are nearly overbought

Bryan Doherty