TFM Sunrise Update 4-20-20


Corn futures were down overnight amid a sharp drop-off in crude as storage sites fill, and stock index futures trade lower to start the week.  The technical picture remains bruised and battered heading into planting season.  Dec corn, overnight was down as much as 1-3/4 cents to within a penny of last week’s new contract low of 3.40-3/4; And, may was down 2 to 3.20-1/4 after losing 9 ½ cents last week.  Forecasts for dry weather conditions in Brazil may be an item to watch in the weeks ahead and could bring buying support at these price levels.  Meanwhile, President Donald Trump on Friday announced a $19 billion relief program to help U.S. farmers cope with the impact of Coronavirus, including $16 billion in direct payments to producers and mass purchases of meat, dairy, vegetables and other products.


Soybean futures were down 3 cents overnight, meal mixed and soy oil weaker.  The weak technical picture and selling pressure from the soybean meal market could bring additional long liquidation on overall global demand concerns for U.S. beans.  Weekly Export Inspections will be out mid-morning today and give us a glimpse of those prospects with technicals already trending lower.


Wheat futures rallied overnight on reports that Russia will suspend wheat exports, threatening to tighten global supplies.  May Chi wheat jumped back up to the contract’s 100-day moving average on gains of 14 cents, all but erasing last week’s losses.  May KC wheat was up 13-2/4 cents to 4.92-1/2; And,  May Mpls wheat advanced 8-1/4 cents to 5.15.  Global weather in Europe and the Black sea region are being closely watched for any production reductions.


Live cattle futures are called mixed as the lack of clarity in the cash market further clouds an already confusing marketplace.  Despite the strength in retail carcass values, the concern about cash markets and reduced slaughter numbers continue to create caution about backing up slaughter cattle numbers.  Technically, stochastics are at mid-range, but trending higher, which should reinforce a move higher if resistance levels are taken out.


Lean hog futures are called steady to firmer.  Processing plant closures bring concerns about handling the large supply of slaughter-ready hogs.  Retail carcass value strength and plans for mass purchases of meat by the Government offers buying support for the market.  There is still no clear sign that a low is in place, but confidence will build if slaughter plants are able to catch up on lost production.


Kelly Rubisch

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