Corn futures are trading with sharp gains so far this morning, recovering nicely from yesterday’s losses. Jul corn is up 10-1/4 cents to 4.29, Sep corn is up 10-1/4 cents to 4.38-1/4, and Dec corn is up 10 cents to 4.45-3/4. Yesterday’s session likely consisted of lots of profit taking and producer hedging when Dec broke through the 4.50 barrier. The sheer amount of acres left to plant will likely leave a very tight balance sheet for corn, and the market is finding buyers on this idea this morning. Technical indicators are still giving overbought readings, but yesterday’s correction alleviated some of this. Dec corn has yet to break through the 4.50 mark today, which could be a psychological point of resistance. The U.S. sold 442,100 tons of corn for the week ending May 16. This is down 20% from the previous week and down 20% from the previous 4-week average. Funds bought 15,000 contracts of corn yesterday and are thought to be net short about 15,00 contracts.
Soybean futures are trading moderately higher today, with Jul up 4-1/2 cents to 8.76-1/2, Aug beans are up 4-1/2 cents to 8.83, and new crop Nov soybeans are up 4-1/4 cents to 9.02-3/4. The 2019 soybean contracts are again testing their 50-day moving average resistance level. Soybeans tested these barriers yesterday, but were unable to close above them. Some drying in the forecast could allow bean acres to increase, but forecasts are still mixed overall. For the week ending May 16, the U.S. sold 535,800 tons of beans, up 45% from the previous week and up noticeably from the previous 4-week average. Funds bought 16,000 contracts of soybeans yesterday and are thought to be net short about 118,000 contracts.
Wheat markets have recovered from some of yesterday’s losses, with Jul Chi wheat up 8-1/4 to 4.98-3/4, Jul KC wheat is up 8 cents to 4.61-1/4, and Jul spring wheat is up 2-1/2 cents to 5.51-1/4. The Jul contract sold off some more this morning, testing its 10 and 100-day moving average and found buyers quickly thereafter. Jul KC wheat has punched through its 100-day moving average resistance level so far this morning. KC wheat futures closed above that level on Tuesday for the first time since August of last year. Excess moisture this week in OK and KS has helped the KC wheat close some ground on the Chi wheat. There are concerns about dryness in southern Russia and western Europe for the week ahead. The U.S. sold 48,400 tons of wheat for the week ending May 16. This is a marketing year low, and down 58% from the previous week, and down 74% from the previous 4-week average. Wheat sales have already passed the USDA’s estimate for wheat sales this year. Funds sold 9,000 contracts of wheat in Chi yesterday and are thought to be net short about 34,000 contracts.
Cattle markets are mixed to lower this morning, with Jun lives up 20 cents to 112.55, Aug lives are down 20 cents to 107.65, and Oct lives are down 12 cents to 108.02. Aug feeders are down 1.82 to 140.90, and Sep feeders are down 1.65 to 141.37. Price action has been relatively quiet, but also disappointing. The Aug live cattle contract briefly tested its 10 and 20—day moving average resistance levels, but ultimately found sellers to push prices back below. Aug feeders tested their overhead 10-day moving average resistance level, but was unable to break through. Beef prices have been choppy, and cash bids have been seen today so far at 116, 1.00 above yesterday’s fed cattle exchange sales. Spotty weather forecasts for many parts of the country this weekend are keeping beef supplies burdensome.
Hog markets are lower this morning, with Jun down 1.45 to 83.75, Jul hogs are down 42 cents to 87.37, and Aug hogs are down 17 cents to 88.95. The U.S./China trade negotiations appear to have ground to a halt, not a positive development for the hog markets. Just today, there were reports released that China has stopped its goodwill purchases of U.S. soybeans. However, there may be some progress on USMCA with Vice President Pence heading to Canada today and a bipartisan group of congressional aides are scheduled to visit Mexico city next week. This should help get U.S. pork exports to Mexico back on track.