Corn futures are trading slightly higher in quiet price action today with Dec up 3/4 of a cent to 3.72, Mar is up a penny to 3.83-1/2, and May is up 3/4 of a cent to 3.91. There is still plenty of uncertainty over U.S. corn production this year, and given how far China corn stocks have fallen over the past two years, corn still seems cheap. Brazil is expected to produce a record corn crop this year of 2.3% from last year. Forecasts in the U.S. are still showing above normal temperature and precipitation for the next two weeks. The U.S. sold about 1.46 mil tons of corn for the week ending September 12. This was above the high end of trade estimates and is very supportive. Dec corn today has traded within a tight range of less than 4 cents. Momentum indicators are pointing higher, though stochastics are giving readings close to overbought. Speculative funds were thought to have bought about 7,000 contracts of corn yesterday.
Soybean futures are trading slightly higher this morning after testing nearby support. Nov beans are up 3-1/2 cents to 8.92-1/4, Jan beans are up 3-3/4 cents to 9.06, and Mar beans are up 3-1/4 cents to 9.18-1/2. The soybean market does not seem to want to break too far considering U.S. and China trade relations appear to be trending in the right direction. The U.S. and China are currently laying ground work for a trade pact and will negotiate on national security issues separately. This is seen as positive as it could expedite a deal while leaving sticky national security issues to a separate process. Still, global soybean demand is lower than last year with the spur of ASF. The U.S. sold 1.73 mil tons of beans for the week ending September 12, sharply above the high end of trade estimates. The Nov soybean contract today back tested its 100-day moving average support level for the third session in a row and was able to attract buyers and is now trading at the highs of the day. Momentum indicators are pointing higher though prices are close to overbought levels. Speculative funds were thought to have sold about 4,000 contracts of soybeans.
Wheat markets are mostly higher this morning with Dec Chi wheat up 1/2 of a cent to 4.90, Dec KC wheat is up 3-1/2 cents to 4.13-1/4, and Dec spring wheat is up 10-1/4 to 5.23-1/2. Strength in calendar spreads in the Chi and KC markets has been a supportive factor lately. Today’s strength has also been impressive considering Egypt’s wheat purchase was made at a cheaper price than was expected. Late harvest concern for corn and soybeans may keep winter wheat prices supported as planting could be pushed back. Mpls wheat futures are rallying on excessive wetness delaying harvest and impacting quality. The U.S. sold 287,000 tons of wheat for the week ending September 12, missing the low end of expectations. Dec Chi wheat closed above its 50-day moving average resistance level yesterday for the first time since mid-July and is holding that level so far today. KC wheat is trading at the highs of the day and Dec Mpls wheat has moved above its 50-day moving average resistance level for the first time since June 28. Speculative funds were thought to have bought about 3,000 contracts of Chi wheat yesterday.
Cattle markets are mixed this morning with Oct lives down 32 cents to 100.05, Dec lives are down 17 cents to 105.97, and Feb lives are up 15 cents to 112.52. Sep feeders are up 27 cents to 140.15, and Oct feeders are up 35 to 138.75. Expectations for a light Cattle on Feed report on Friday are supportive though trade activity will likely be quiet leading up to it. Very strong packer margins have kept marketing pace extremely current and weights are below the 5-year average. Heavy beef supplies, however, have kept retail prices on the defensive. Dec live cattle are so far making an inside session with prices near the highs of the day. Oct feeders are testing their 100-day moving average resistance level and a close above would be the first since April 29. Stochastics are giving overbought readings in both markets though the trend still appears to be higher.
Hog markets are mixed this morning with Oct down 37 cents to 62.55, Dec is up 1.65 to 69.47, and Feb is up 97 cents to 75.80. The nearby Oct contract is being held back by the falling cash index, but the deferred contracts are rallying on the further spread of ASF and a feeling of positivity on trade relations with China. A very strong slaughter pace has kept pork production high and retail prices cheap, and until real exports to China begin to materialize, pork prices will have a tough time rallying. The best traded Dec contract is currently making an outside session higher, which is a positive technical signal. Stochastics are giving overbought readings and nearby resistance comes in around 70.70. A close above that will be the first above the 200-day moving average level since July 30. Feb hogs retested nearby support at the 50-day moving average level and are trading at the highs of the session.