Corn futures were down 3 to 4 cents overnight to start the week. Look for continued consolidation as harvest marches forward. Weekend weather was generally favorable for harvest, but, overall, a slow dry-down provides some underlying support. Basis levels for this time of year are sitting better than normal. Meanwhile, commodity brokerage INTL FCStone on Friday raised its estimate of the average U.S. 2019 corn yield to 170.0 bushels per acre, from 169.3 in its previous monthly report released on Oct. 1. The firm raised its corn production forecast to 13.911 billion bushels from 13.887 billion previously.
Soybean futures traded two-sided overnight between the November contract’s 20-day moving average at 9.27-1/2 and 9.21. Though bean prices finished with small gains last week, we’re somewhat disappointed weather hasn’t had more of an impact as harvest is delayed in many areas due to wet weather, snow, or melting snow and optimism China and America are moving closer to an interim trade deal. November 8 is the next USDA report. For now, FCStone on Friday forecast U.S. soybean production at 3.593 billion bushels, down from 3.648 billion previously, and lowered its soybean yield estimate to 47.5 bushels per acre, from 48.1 a month ago.
Wheat futures retreated 4 cents overnight from Friday’s higher close when prices ended the week on a firm note, gaining 7 cents on all three exchanges. Dry weather in Australia is viewed as beneficial, yet, ample world inventories will likely be reflected on the November 8 Supply and Demand report.
Cattle futures are called steady to higher on follow-through after a very strong close last week and a continuation of the rally that has now nearly reached 20.00. Cash cattle sold from $113-116 live last week and Dec live cattle are fast approaching $120 on the board. Technically, the contract is arguably over bought while trading at its highest level since April.
Hog futures are called mixed as big daily slaughters continue to limit upside potential. Pork cutout values remain choppy, too. All in all, futures are plotting a sideways, consolidation move as the trade awaits a solid U.S./China agreement. Nearby Dec hogs, at 64.45, represent the majority of the trade volume and are now below all moving averages. Last week’s daily low at 63.45 is near-term support.