CORN

Corn futures were unchanged overnight as the market awaits fresh news.  Managed Money bought an estimated 1,000 corn contracts yesterday and is net short an estimated 47,000.  Trade estimates for this morning’s USDA Weekly Export Sales are up to 100,000 tons for old crop and 1.50 to 2.50 mil tons for new crop.  Private analyst estimates for this year’s corn crop have been coming in higher than anticipated, keeping the supply side of the balance sheet heavy.  Prices are fighting strong resistance over Dec at the $3.63 level, which could contain upside potential in the short-term.  Price action the past two days has been favorable, though, as corn futures surge off early session lows awaiting further damage reports from Iowa due to a lack of moisture.  Much of the state received less than 25% of normal precipitation for the month of August.

SOYBEANS

Soybean futures eclipsed their new highs for the move established in Monday’s trade overnight on gains of 5 cents to 9.67 (Nov) after settling near session highs on Wednesday.  Soybean meal and oil were also higher.  Managed Money is estimated net long 159,000 Soybeans; net long 12,000 lots of soymeal, and; long 75,000 soyoil.  Late afternoon talk of Chinese firms buying 8 cargoes U.S. beans and this morning’s Weekly export sales should stay supportive, but we will be watching for additional demand from buyers other than China.  Trade estimates range between 1.0 to 1.8 mil tons of new crop beans, 50,000 to 250,000 tons for meal; and, 5,000 to 30,000 tons for oil.  Chances of frost issues next week, plus talk of a La Nina developing soon, which could impact South American production is also noted.  The 6 to 10 day forecast for the Midwest has temperatures falling to below average by the weekend and for the first half of next week.

WHEAT

Wheat calls are steady after trading narrowly mixed overnight.  Traders took some profits and consolidated daily charts after Tuesday’s strong rally fueled by some production concerns in the global wheat crop and a weakened U.S. dollar.  Since then, talk of higher Canadian yields has come to light, and the dollar is currently in the midst of a technical bounce.  Egypt GASC is looking for a new wheat tender for November 5th through the 15th delivery could support the market and provide a glimpse of how the U.S. wheat price compares to other global suppliers.  Jordan is also in the market for 120,000 tons of optional-origin wheat, and Philippines seek 165,000 tons of optional-origin feed wheat.

CATTLE

Live cattle futures called steady with charts staying technically weaker and futures lining up closer to cash.  October cattle, at 104.47, again failed to push above the-50 day moving average, and instead broke to the downside out of consolidation.  Cash trade is developing this week at $104 in the south, down $1 from last week.  Retail values have been choppy this week, bringing some potential demand concerns going into the fall.  Choice carcasses have been weaker as retailers are moving past the Labor Day holiday demand.

HOGS

Lean hog futures are called steady.  Technically, prices are trending higher and could look to challenge last week’s highs, but for now, they’re consolidating off of last weeks highs with the supply side of the market staying on the heavy side, thus limiting buying interest.   Demand will be the key for prices in the future, and weekly export sales today will be closely watch for new Chinese business.

Author

Matthew Strelow