CORN
Corn futures were weaker again overnight in light volume. July corn is down 4 cents to 7.91-1/4. For the week, the contract is up 7 cents with a new contract high in the books at 8.14. Dec is down 7-1/4 cents to 7.31-1/2 this morning as contracts ease toward 10-day moving average support established beneath the recent daily lows. For the week, Dec is down 4 cents with Tuesday’s new high etched at 7.55. U.S. stocks are lower. The U.S. Dollar is higher, and crude, gold, silver, copper, coffee, sugar and cotton are lower. Meanwhile the Russia’s aggression against Ukraine continues, and the market is trying to adjust to the U.S. Fed’s expected raise of interest rates 50 basis points to fight inflation. China is also talking of fighting inflation. Look for choppy to weaker corn trade as participants eye upcoming Mid-west planting progress. The current U.S. eastern Midwest’s wet and cool weather could delay early corn planting. On Thursday, Managed funds were net sellers of 13,000 corn keeping them at an estimated 374,000 bought contracts.
SOYBEANS
The soybean complex was lower overnight including double digit declines in beans. July futures fell 15 cents to 17.04-1/2. Nov beans were lost a dime to 15.21-1/4. Meal is down 4.0 in the July contract to 459.90 and bean oil is off .26.to 79.38. For the week, July bean are up 40 cents and Nov is up 20 cents. After the April USDA report, July soybean futures traded up from 16.25 to 16.76 and July soymeal is trading between the 50-day Moving Average at 455 and the 20-day at 463. July soy oil traded from 71.16 to 74.34. July soybean futures could be supported by even lower South America supplies and higher global sun oil and rape oil prices. On Thursday, Managed funds were net sellers of 11,000 soybeans, 2,000 soymeal and bought 2,000 soyoil. They are now, as of last night, long an estimated 179,000 soybeans, 101,000 soymeal and 95,000 soy oil.
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WHEAT
Wheat futures are in the red this morning led by Chicago contracts. July is down 12 cents to 10.64-1/2. The Chicago contract has lost 42 cents this week. KC wheat is off a nickel to 11.38-1/2 and is down 20 cents for the week. July MPLS is down 2 to 11.52-1/2, but is up a nickel for the week. Uncertainty over the situation in Ukraine and U.S. 2022 southern Plains weather is limiting new volume due to the potential increase in price volatility. The key now is global demand and world 2022 weather. An outlook for this year’s U.S. winter wheat crop yield is up slightly from previous forecast of 49.2 bu/acre, according to data issued by Planalytics on Thursday in its third forecast of the season so far. On Thursday, Managed funds were net sellers of 10,000 Chicago wheat flipping their position from long to short an estimated 4,000 contracts.
CATTLE
The cattle market is called mixed to higher as cash market strength and technical buying support the markets this week. Technically, charts are improved, and buyers should stay active going into the Cattle on Feed report after the market closes today. The trade is expecting to see feeder placement decline year-over-year, which could support Feeder prices. Overall expectations for the report are: Total cattle on Feed at 100.4%, Placements at 92.2%, and Marketing at 98.2% of last year. The most actively traded June contract is challenging the psychological $140.00 level while climbing through layers of resistance. Cash trade looks wrapped up for the week with Southern live deals marked at $139 to $141, mostly $140, $1 higher than last week’s weighted averages. In the North at $228 to $236, mostly $230, $4 higher than last week’s weighted averages. Some regional packers saw strong bids to 146 in Nebraska, but the higher trend is well established. Beef cutouts were mixed on the close (Choice 270.17 +1.35; Select 256.53 -.85), with improved box movement of 104 loads. The feeder market saw buying strength supported by the live cattle strength, and lower trade in the grain markets. Apr feeders are still tied to the index, slipped .76 to 153.90 but is running at a discount to front-month futures and could be a limiting factor.
HOGS
The hog market is called steady to lower. Bear spreading is still the focus as the premium of futures to the cash market weighs on front month contracts. June hogs are weak technically and look to be ready to challenge support at the 115.000-117.000 level. This price area will be a key level to help maintain the current uptrend in the market. The Lean Hog Index was .95 higher to 100.93. The deferred futures premium over the index is concerning and a limiting factor, as May is holding a 9.920 premium to the index. Pork carcasses were higher at the close gaining 1.71 to 110.20 with a load count light at 183 loads. USDA released weekly export sales on Thursday morning, and new net sales totaled 12,900 MT, a marketing year low. Mexico, South Korea, and the Philippines were the top buyers of U.S. pork last week. The hog market might be trying to find some equilibrium and balance in price values as the market is tightening the premium to the cash market. The cash market may be trying to find some footing at the end of the week, and that could help slow the selling pressure.
Author
Matthew Strelow