Corn begin the week in the lower half of their 10 cent trading ranges since the beginning of the month with Managed Money still holding a sizable short position. Dec corn was mixed overnight at 3.33 and looks to continue consolidating and looking for direction. Welcome rains greeted newly planted fields across much of the upper Midwest over the weekend. This week, the market will focus on planting progress, ethanol demand and early crop weather. In addition, we’ll watch China’s demand for corn. Crude is up sharply this morning and stock index futures are higher which is providing some outside market support. Weekly Export Inspections will be out mid-morning today.
Soybean futures were higher overnight with Nov up a nickel to 8.50-1/2 and trending sideways. Soyoil is firm, meal weak. Improved Chinese demand may be finally getting some notice after seeing the bean market fall flat last week on competition from Brazil. They have a ways to go to meet the Phase one deal commitments. NOPA pegged April crush higher than expected which may be a source of lingering support. Planting progress will also help set the direction for this week, as well as the spread of COVID-19 in Brazil and its possible impacts on shipping ports.
Winter wheat futures continued to slump overnight and are testing key support levels to start the week. A fresh round of new lows for the move were posted in Chicago with July down 4 cents to 4.96-1/4. July KC was down 3-3/4 cents to 4.48-1/2. Mpls wheat is firm. Winter wheat contracts will be subject to a break lower level if support fails. This likely scenario is highlighted by disappointing weekly closes that favor the bears in the wheat market. Less than adequate soil moisture levels in Western Europe and Black Sea region, as well as lower production forecasts for France may slow the tide of selling pressure in this negatively tilted market.
Live cattle futures are called steady to firmer. Cash markets stayed strong with $120 trade in Texas at the end of the week. Deferred contracts face pressure with fears that the backed up slaughter pace could linger into the longer range months. Retail values appear to have topped out in value last week, with improved an slaughter pace as plants reopen from COVID-19 issues. This could be indirectly supportive to keep product moving from packer to retailer.
Lean hog futures are called mixed as the trade monitors slaughter chain speed that has been slowed due to coronavirus impacting the work force. The discount of futures to the cash market does offer support, however, weak closes at the end of the week sets up the start of this week with more potential selling pressure.