FROM ALL OF US AT TOTAL FARM MARKETING, HAVE A HAPPY AND PROSPEROUS NEW YEAR!
FRIDAY, DECEMBER 31: The CME has regular trading hours. Total Farm Marketing offices will close at 2:00 CT; there will be no Top Farmer Intelligence report.
CORN
Corn futures were mixed overnight and near unchanged while hovering around Tuesday’s session lows. Bullish news has subsided, allowing prices to drift lower from new highs and a technically overbought market. March corn traded an overnight high of 6.05-3/4 and low to 6.01-1/2 after posting a bearish reversal yesterday. A dip below $6.00 could unleash some additional selling pressure, especially as year-end position-squaring unfolds and money flow shifts back and forth between commodities and equities. December corn is down 2-3/4 cents to 5.46. Weather forecasts for South America are released frequently throughout the day, giving traders a steady dose of market-moving news. For now, more rain is showing up on bulletins for this upcoming week for Brazil. The latest World Weather Inc. headlines ready “Argentina Will Not See Much Relief From Dryness”, and indicates Argentina will see sporadic rainfall of mostly light intensity in the next week to ten days offering some temporary relief to recent drying, but crop conditions will further deteriorate in the driest areas raising the need for immediate rain of significance. Weekly Ethanol Stats are on tap for later this morning, Exports tomorrow. Ethanol output and stockpile projections for the week ending Dec. 24 are as follows: Production seen higher than last week at 1.055 mil barrels per day; Stockpiles average estimate is 20.762 mil bbl vs 20.705 mil a week ago.
SOYBEANS
Soybean futures eased a few cents overnight. Nearby Jan futures are down 3 cents to 13.56-1/4, and Nov beans are down 2-1/2 cents to 12.69-3/4. Some backtracking can be expected after such a steep rally in meal over the past couple weeks. The Jan meal contract posted its eighth straight session higher yesterday before slumping lower into the close. Those contracts are firm this morning, Soy oil weaker. South American weather forecasts calling for better chances of moisture, coupled with easing concerns over the health impact of the Omicron virus has taken some of the wind out of the sails of the recent bull market heading into another 3-day holiday weekend. Overnight, Chinese May bean futures were down 91 yuan; Soymeal down 30; Soyoil unchanged; Palm oil up 14; Corn down 14. Malaysian palm oil prices were down 77 ringgit (-1.61%) at 4695.
WHEAT
Wheat futures were down 2 to 3 cents overnight as prices continue to sag. March Chicago wheat is down 2 cents to 7.81-1/2 while targeting the contract’s 100-day moving average support lined up at 7.68-3/4. March KC wheat is down 2 cents to 8.19-3/4; And, March MPLS wheat is down 4 to 9.95-1/2. The fact that row crops have topped out for the moment and posted some bearish technical signals may be helping weigh on wheat. Recent price strength may have occurred too early to trade U.S. 2022 weather. Technically, the market posted bearish reversals to start the week followed by selling on Tuesday. Talk of Iraq delaying their tender of which some were hoping they would purchase wheat from the US is noted. In addition, Russia is receiving some snow which should help to insulate the crop and provide moisture in the spring.
CATTLE
Cattle futures are called steady to weaker following yesterday’s disappointing technical action. Feb live cattle, at 139.40 did managed to erase an early sell-off to close with a modest gain. However, we would expect this week’s high of 140.325 to be a firm resistance area, barring anything bullish to come along. Cash is quiet, so far this week and futures are likely to take their cue from activity in the arena this week. Cattle were purchased last week at $135 to $136/cwt and packers will be actively pursuing supplies for a full slaughter week. Meanwhile, Omicron news blankets the meat markets with concerns over demand, as well as frigid weather entering the Plains this coming weekend. Feeders may see some more upside probing after posting triple-digit gains yesterday supported by a pullback in feed grain futures.
HOGS
Hog futures are called mixed as traders align spreads. Futures have been holding a wider than normal premium to the cash market and market reaction to last Thursday’s Hogs and Pigs report has been disappointing. Feb hogs start the day at 82.625 while holding support at the contract’s 200-day moving average drawn at 82.13. The market is still in a bullish tilt after failing to take out the recent high Nov 26 yesterday etched at 84.675.
Author
Matthew Strelow