TFM Sunrise Update 3-17-20


Dec corn futures slipped to another new contract low of 3.66 overnight on downward momentum. However, some stabilization in outside markets point to calls for mixed, two-sided trade in corn today. Crude is firm while building a base of support, and stock index futures made a new low overnight and are now up 200 points. Still no evidence of help from a four-leaved clover as of yet, though. Front month corn futures closed 11 cents lower to start the week as concerns mount over demand for both feed and ethanol, and uncertainty amid global reaction to coronavirus. It looks as though corn may the one commodity in the grain and oilseed complex that could be running out of selling interest, particularly with demand being as it is. Weekly Export sales have been strong. On Monday, South Korea had two groups purchase a total of 184,000 tons of U.S. corn.


Bean futures held their lower ground overnight and are up 7 to 8 cents along with a recovery attempt in soyoil and meal. The damage has been done, though and prices are likely to remain depressed until something positive happens that would attract significant buying interest. For now, that light at the end of the tunnel may begin showing up in the form of the pandemic curve beginning to shift in China, at least according to some reports stating that incidences of spreading the disease has been largely contained.


Wheat futures called mixed to lower as prices continue to struggle with the effects of coronavirus, as well as declining currencies of competing countries. Winter wheat contracts traded two-sided overnight. However, the dollar is back up again thus keeping export hopes low. In addition, managed money is historically heavily short Mpls spring wheat.


Cattle futures are called flat to firmer after becoming overwhelmed by the woes of the stock market. The disconnect between cattle futures and the cash markets reached an unprecedented level not seen in the history of the futures market. Continued concerns over coronavirus and liquidation are primary features and packer capacity is a concern if packing plants are forced to shut down.


Hog futures are called steady to firmer after yesterday’s sharp losses in the May, Jun, and Jul months. Apr finishing at 2.40 lower suggests cash prices may be starting to level out. The huge discount of futures to the cash market should give some boost to the front months mid-week.


Carol Tillmann

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