TFM Sunrise Update 12-19-19


Corn futures traded 1-3/4 cents lower overnight after failing at the 100-day moving average and seeing some correction in Wednesday’s trade for the front-month contracts. The trend has turned lower and strong support was hit at 3.85 in the March contract last night, as the market anticipates concern regarding this morning’s weekly export sales. In addition, the White House has announced that it will go ahead and finalize their current 2020 biofuel blending requirements that allows more waivers to smaller refiners that corn farmers find acceptable. Ethanol production for the week ending December 13 was down .75% from the previous week.


Soybean futures fell 6 cents overnight, souring the recent friendly technical outlook led by soyoil. Futures saw choppy, sideways action in Wednesday’s trade, but that has given way to lower. Demand will still be the key in the short term, and if weekly export sales this morning stay supportive, the market may see additional short covering as prices look to push to the top of the trading range approximately 30 cents higher. Overall, bean prices will likely stay volatile, based on news headlines for the oilseed.


Wheat futures were firm overnight. Prices saw some profit-taking in yesterday’s trade, while the overall technical picture still stays supportive. Winter wheats were up 2 last night and as we move toward the end of the year, prices will likely stay choppy and need to hold above key support levels that acted as resistance on this most recent rally. Global wheat supplies stay relatively heavy, but the current trend is supportive.


Cattle futures are called mixed. The cattle market may be looking for direction through the remainder of the week as we move closer to tomorrow’s cattle on feed numbers. Estimation for total cattle on feed to be at 101.9% of last year’s total, but placements will be closely watched to get an idea of the herd going into the summer and fall months. Cash trade is staying relatively undeveloped, and retail values have been choppy and now working lower this week which may make it difficult for prices to find much traction forward.


Hog futures are trading mixed. Look for more of the same with Export sales on this morning offering some direction amid U.S./Chinese trade. Confirmation of additional movement of U.S. pork overseas could bring some additional short-covering as managed money positions and speculative funds positions have now built a relatively large short position for the hog markets.


Carol Tillmann

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