CORN
Corn futures were narrowly mixed overnight atop Monday’s higher closing ranges. Dec is up a penny this morning to 5.33-3/4. A steep 44 point drop in the dollar overnight is helping the grain complex rise to a one-week high. This is also keeping a bid under the rising crude oil market, which bodes well for strength in corn. Overall, corn prices continue to consolidate, wedged in between converging 50-day and 200-day moving averages just above and below current prices as harvest moves forward. U.S. corn harvest is 52% complete as of Sunday, up 11 points from last week and the 5-year average of 41%. Crop conditions were 60% Good-to-Excellent vs 60% last week, and 61% a year ago. Maturity is 97% vs 94% last week, and 97% a year ago. Scarcity of fertilizers is causing headaches for farmers in parts of South America. Growers in the Center-West and Matopiba regions have been reporting that some fertilizer and glyphosate deliveries have been canceled by suppliers, creating a backlog of planting progress with the biggest concern for winter-corn crop as most farmers haven’t bought crop nutrients yet. In Brazil, AgRural reports summer corn seeding is 45% complete, vs 38% a week earlier and 44% in previous year.
SOYBEANS
The soy complex is firm this morning with Nov beans up 6 cents to 12.27. The contract edged out Monday’s session high overnight, putting the contract on track for a fourth consecutive day of gains. U.S. bean harvest is 60% complete as of Sunday, up 11 points from last week and 5 points ahead of the 5-year average of 55%. Soybean leaf drop is 95% vs 91% last week, and 96% a year ago. Brazil’s soybean planting is 22% complete as of October 14, according to AgRural. This is the second fastest pace on record. Planting was at 10% a week earlier, and 8% a year before. Moisture levels in the soil and good weather are helping to boost planting. Soymeal is up 3.50 per ton this morning, soyoil firm. Chinese Jan beans were down 35 yuan overnight; Soymeal down 32; Soyoil up 114; Palm oil up 118; Corn up 5. Malaysian markets are closed for holiday.
WHEAT
Wheat futures are firm this morning with Dec Chicago and KC contracts up 7 cents to 7.43-1/4 and 7.56, respectively as large pennant formations on the charts highlight consolidation within a generally bullish market. Dec MPLS made a new high of 9.76-3/4 overnight amid a 9 cent gain. A plunge in the dollar overnight aided overnight gains. U.S. winter wheat planted is 70% vs 60% last week, and 76% a year ago. Emergence was pegged at 44% versus 31% last week and the 5-year average of 47%. Some Oklahoma growers were finishing up the planting of the wheat crop they will harvest in the summer of 2022. Spot basis bids for HRW wheat were flat at grain terminals across the southern U.S. Plains on Monday amid slow farmer sales, according to grain dealers said.
CATTLE
Cattle futures are called steady to lower. Futures finished lower in a quiet session to start the week, supported by the prospects of improved retail demand going into the Holiday season, but cautious overall of the direction of cash trade and outside markets. The lack of follow through to start the week was disappointing, and a weak close could signal that cattle may be at the top of the range. Prices are starting to trend higher, but prices may be more choppy in the near-term. December remains around the $130 price level, and but failed to push higher after a strong close last week. Cash trade stayed typically quiet on Monday as show lists and bids are still being put together. The majority of cash trade will likely hold off until the second half of the week. Midday retail values were mixed, but were negative at the close. Choice carcasses slipped .15 to 280.09, but Select lost .81 to 259.81. The load count was light at 115 loads. Feeder cattle traded lower across the complex. The premium of the futures to the cash index limited the front end of the market. The Feeder Cash Index has been trending lower, but still holds a large discount to the front-month Oct futures.
HOGS
Hogs are called steady to higher after starting the week with moderate gains on short covering. December hogs tried to climb higher, but stayed mostly range bound with a mid-range close on Monday. Direct cash trade was mixed to firmer on the Monday close. Carcass based prices were .09 lower, but live pricing was $1.11 higher. The strong cash close should support the opening today. The Lean Hog Index traded 1.23 lower to 87.52 trying to tighten the gap with the December contract. The premium to Dec hogs should help support the front of the market, trading at 8.840 today. At midday, the retail pork carcass sector was firmer, gaining 5.84, but the market lost those gains, dropping to a close of .54 lower to 100.78 on moderate movement of 344 loads. An improvement in both cash prices and retail carcasses would go along way of bringing buyers back to the hog market. Technically, the uptrend is still intact, but prices are filling gaps and firming up the charts. Prices are now testing the bottom of the range, and will need some fundamental help to turn the corner.
Author
Matthew Strelow