TFM Sunrise Update 10-1-19


Corn futures saw a modest 1 o 2 cent technical pullback overnight after rallying to start the week on a surprisingly friendly USDA report. The agency reduced quarterly stocks by over 300 million bushels. This may encourage follow through buying today. Funds were net buyers an estimated 55,000 corn contracts on the rally. Corn at the dent stage is 88% versus a 5-year average of 98%. Maturity, however, is 43% versus a 5-year average of 73%. Harvest is 11% complete. Lastly, ratings indicate 57% good to excellent, the same as last week. Technically, Dec corn, at 3.86-1/2 has the 200-day moving average at 4.02 serving as a bullish target for the trade.


Soybean futures were up 2 to 3 cents overnight, forging a new high for the move after erupting for gains of 20+ cents yesterday with funds buyers of 17,000 bean contracts, 4,000 Soymeal, and: 5,000 lots of Soyoil. The crop is behind schedule, and there is a lot of rain in the forecast for the northern tier states, which will slow or reduce harvest. Dropping leaves is at 55%, versus a 5-year average of 76%. Nov beans got to 9.09 last night and are only a few cents away from the contract’s 200-day MA at 9.11-1/4. Chinese buying is also helping the market and will be monitored closely moving forward. The U.S. Department of Agriculture’s monthly oilseed crushings report is expected to show that 5.369 million short tons, or 179.0 million bushels, of soybeans were processed in August.


Winter wheat futures were down slightly overnight, Spring wheat up 1 to 3 cents as weather conditions prohibit the final harvesting efforts up north. Planting progress for winter wheatis on schedule at 39%, but dry conditions in parts of winter wheat country and too wet in other parts could limit field work this week. Spring wheat is at 90% harvested, only 3% ahead of last week. The 5-year average is 99%.


Cattle futures are called steady to lower. The market remains in a steep near term uptrend front-running stronger seasonal cash tendencies for this time of year, but yesterday’s small trading range and weak finish might suggest futures positions are running out of buying interest, at least on the front months. A drop of by 2.75 in select cuts yesterday could also suggest the market is running out of steam.


Hog futures are called mixed to higher on follow through after a very impressive reversal yesterday. Prices traded lower in the morning on a less-than-stellar Hogs and Pigs report on Friday, but finished with a bang, gaining 1.77 to 2.75 as buyers stepped in and took over the market.


Lisa Heder

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