Corn futures were down a penny overnight. Outside markets and a heavy supply picture keep corn prices in check as we hit mid-June with Managed Money short just shy of 300,000 contracts. Missouri and Iowa into Wisconsin generally have adequate to excessive topsoil moisture due to rain from Tropical Storm Cristobal a week ago. Many other areas in the eastern Corn and Soybean Belt have dried down during the past week, though topsoil moisture is generally marginally adequate. Topsoil moisture varies widely in the northern Plains with eastern areas having adequate moisture while western areas are running a little short of moisture. Overall, crop conditions, which will be updated this afternoon, are not deemed threatened with pollination a ways off in the growing cycle. Weekly Export Inspections will be out mid-morning.
Soybean futures were down 3-1/2 to 5 cents overnight with weather forecasts and news headlines key drivers for this week’s prices action. Improved Chinese demand and the break in the U.S dollar versus the Brazilian real have supported the market. However, according to AP, China on Sunday reported its highest daily total of new coronavirus cases in two months after the capital’s biggest wholesale food market was shut down following a resurgence in local infections. There were 57 confirmed cases in the 24 hours through midnight Saturday, the National Health Commission reported. That was the highest daily toll since mid-April and included 36 in Beijing, the capital. The new cases illustrated how the virus can come back as anti-disease controls are relaxed. This may warrant caution in the markets based on what reaction we’ve already seen this spring.
Wheat futures were mostly steady with a weaker tone overnight as heavy global wheat stocks limit rallies. Focus on overseas weather and the development of those wheat crops and a fluctuating U.S. dollar will keep wheat prices choppy in the near term. Wheat will likely be led by other grains and global wheat prices.
Live cattle futures are called steady to lower. Pressure from weak retail values and declining cash market trends keeps selling pressure in the cattle market. Most cash was $107-108 last week, $3-4 lower than last week and the slaughter pace is back to pre-COVID-19 levels, as the industry works through the backlog of cattle. The drift lower in prices reflects the reluctance of traders to push prices in a meaningful way while so much of the economy and outlook for demand remains cloudy.
Lean hog futures are called mixed to lower. Front month contracts have been seeing selling pressure due to cash weakness and large slaughter supplies. Slaughter pace ran much stronger this week, which will be key to getting the hog market more current with backed up supplies of slaughter hogs. After the price rebound two weeks ago, futures are attempting to stay above the 50-day moving average for the first time since January. Once prices have several closes above, it opens up a shot at the 200-day, which for October is near $67.50 and December near $63.75.