TFM Sunrise Update 12-16-19


Corn futures made new highs for the move overnight, further painting a 3-month low in place and a bullish weekly key reversal, the second since September. Though prices may have tailed off on Friday from their highs, news last week was generally supportive and helped propel 7 cent gains overnight. Trade news favors prices support moving forward after corn prices tailed off with this year’s prolonged U.S. harvest. Weekly Export Inspections will be out mid-morning, and demand will be closely monitored with the Phase 1 deal between the U.S. and China expected to prop up sales of corn.


Soybean futures made 8 to 9 cent gains overnight putting bean prices back at the top of Friday’s higher trading ranges achieved on news of the Phase 1 deal between the U.S. and China. The positive tilt in beans is helped by new highs in bean oil. Attention will now focus on South American weather and export sales. Sales remain ahead of schedule and with an agreement with China, it’s likely that prices could have a strong undercurrent. Weather in South America becomes more critical on a weekly basis.


Wheat futures advanced 7 cents overnight, adding to last week’s significant volatility, though little price change on the week. Mar Chi gained 8 cents last week but lost 17 cents the week before. News of a Phase 1 deal is bringing support across the board, including wheat to begin the week. A weakening dollar is also noted.


Cattle futures are called steady to higher. Strong gains on Friday, including a new contract high for Feb live cattle, were impressive and a likely response to the idea that beef exports could be on the rise to China after an agreement reached with China for Phase 1 of negotiations. Friday’s cash sales were at higher prices. In the north, live trade reached $122/cwt, $2-3 higher. Feeders also rallied 2.00 to 3.00 and look poised to move higher this week.


Hog futures are called mixed to higher on follow through after a firm finish last week on deferred contracts. Yet, prices exploded on Friday but finished on a disappointing note well off their highs. This suggests the trade is concerned about daily slaughters which remain large. That said, pork is likely high on China’s buying list from the U.S. given the high price of pork in China.


Carol Tillmann

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