Cattle futures were the star of Wednesday’s session starting off lower and then staging a big rally in the feeder cattle, which pulled live cattle into positive territory.  The market was technically oversold, but held support and rallied off of that.  Shortcovering and bull spreading were also features.

Hog futures were under pressure from the opening bell on profit taking and a more than $3 drop in the cutout value.  Cash was also under pressure during the session and the October contract has faced significant resistance around the $49 level which was its high for the day.

Grains continued to slide on Wednesday.  The market continues to extract weather premium from corn and beans with the lack of frost threat.  Soybeans are also technically weak after closing Tuesday below the long-term uptrend line in on the weekly continuation charts.  Corn was lower early in the session trying to digest the continued large private crop estimates, but held key double bottom support and ended unchanged on the day.  Wheat futures continue to flirt with contract lows on a lack of bullish news.

Michelle Rook

Posted under Michelle Rook

Grains started higher on the opening with a gap higher opening in soybeans.  The soybean market continues to garner support from frost concerns in the Midwest, speculative buying and especially the recent robust demand interest from China.  The drought in China is also impacting soybean production and so they may have a shortage.  Old crop/new crop bull spreading continues to support the September over the November.  Technically though the November did close about the $10 mark.

Corn futures were also higher on the day following soybeans and higher crude oil.   December corn had a strong technical close getting above the $3.35 level which may open the door to additional technical buying.

Wheat ended higher as well, but is basically a follower.  Alone wheat has poor fundamentals with plenty of wheat in the world.  Although there are a few concerns developing in Australia.

The live cattle market ended higher digesting the bearish placement number in the cattle on feed report.  Ideas of higher cash trade this week and strong beef demand going into the Labor Day holiday helped support the futures.  Feeders were lower however, responding to the rally in the corn.

And hog futures ended lower as profit taking set in.  The market failed to build on the higher weekly close last week and a $2.56 jump in cutouts, so the close was seen as disappointing.  Tuesday’s market performance will be key to determining if the futures are indeed trying to put in some sort of bottom.

Michelle Rook

Posted under Michelle Rook

Soybean and corn futures started the day with strong gains and posted gap higher openings on Friday.  The buying was tied to sharply higher outside markets like crude oil, the lower dollar, but the main support in the soybeans came from another 233,000 mt sale of U.S. soybeans to China and cooler weather forecasts which brought back some maturity concerns to the market.   However, corn and beans filled chart gaps and key retracement levels shortly after the opening and then set back off of their highs.  Wheat futures followed on the opening, but gave up gains early in the session to close lower on profit taking and technical weakness and higher than expected crop estimates on the STATS Canada report.

For the week Sept soybeans lost 1 1/2 cents, November was down 8 1/2 cents, Sept corn gained 2 1/2 cents and December lost 1 1/2 cents.  September CH wheat lost 21 1/2 cents, September KC was down 14 3/4 cents and September MN lost 17 1/4.

Cattle futures were lower on unwinding of cattle/hog spreads and positioning before the Cattle on Feed Report.  Feeders saw even more selling pressure with weak cash in the country.  Cash trade development was $141 and $83, both a dollar higher than last week. The Cattle on Feed was slightly negative with the On Feed number at 98%, and Placements at 113% which were both above expectations.

Nearby lean hogs closed higher for the third straight day and futures posted a higher weekly close for the first time in many weeks.  Hopefully the market is trying to establish a bottom, but cash trade and the cutout values will have to start moving higher to confirm that.

Michelle Rook

Posted under Michelle Rook

It was an ugly day in the markets with commodity wide selling pressure and fund liquidation.  A great deal of the sell-off in the grains was tied to sharply lower equity markets as the DOW was down hard overnight and through the day session.  The U.S. dollar index also had a decent rally. Grain markets were also technically weak after posting lower weekly closes.  In fact, November soybeans were down nearly 60-cents last week.

Also contributing to the lower grain market was the bearish weather.  The corn belt received some good rains over the weekend and there is more in the forecast in the next 3-5 days.  Some of the models are also backing off cold temperatures through the end of the month which may negate the idea of an early frost.  As a result, the soybean market is attempting to get rid of some of the weather premium it had built in.

Livestock futures were also pressured early on spillover from outside markets.  Live cattle also saw profit taking after a higher close Friday, spread activity and the premium the futures are holding to last weeks cash.  Cash traded steady to a dollar higher at $82 in the south.  This week expectations for cash are steady to better with smaller showlists in all major feedlot areas.  Boxed beef was also up $1.09 on the choice category on Monday afternoon.

Lean hogs hit new contract lows early in the session and then bounced off those lows in nearby contracts on bull spreading.  However, deferred contracts saw pressure from lower corn prices and lower equities.  Cutout values were up 88-cents and the direct market hogs were down just slightly and are called steady for Tuesday.

Michelle Rook

Posted under Michelle Rook

Grains ended higher with sharp gains in the soybeans as USDA announced before the opening that China had purchased 1.8 million metric tons (70 million bushels) of new crop beans from the U.S. and another 120,000 mt of old crop beans.  This brought the commericials into the market to buy and we also saw bull spreading.  At the close soybeans were 55-cents higher on the November and 70-cents higher in the August contract.  The rally in soybeans spilled over and supported the corn and to some degree the wheat.   However, strong weekly exports, sharply higher outside markets and a lower dollar index also contributed to the market strength.

Cattle futures were higher in both LC and FC as we saw shortcovering and active spread activity support the market.  Meanwhile lean hog futures saw another lower day in the Aug and October, with the deferreds higher on active bear spreading.  Lower cash and cutouts weighed on the nearby futures, with higher corn boosting the back months on the spread action.

Michelle Rook

Posted under Michelle Rook

A mixed day in the markets with cattle, MN wheat and the soybean complex to the plus side, but a lower day in the rest of the trade.

Live and Feeder Cattle futures were both supported by fund buying and shortcovering.  In the case of live cattle a bullish reversal on Monday led to the additional chart based buying.  Ideas for steady to higher cash are also supportive with showlists looking smaller than a week ago.  Cattle action was especially impressive considering the sharply lower hog futures action.  Lean hogs gapped lower on the open on fund selling and tripped sell stops as support was taken out on the charts.  In fact, October close below $53 which could open the market up for additional selling by the funds.  Cutout values were also down $2.11 and that will mean lower cash again on Wednesday.

Soybean futures ended sharply higher on old crop/new crop bull spreads and commercial buying tied to talk of China buying old and new crop soybeans.  It also looked like soybeans were being spread against corn which ended lower on the day.  Corn also saw pressure from farmer selling and lower crude oil.  Wheat futures followed corn and we were mostly lower except for MN wheat.

Michelle Rook

Posted under Michelle Rook

Grains were all lower on the Friday due to consolidation.  Speculative or fund traders sold and took profits on Thursday’s rally in the grains.  Favorable weather continues to foster ideas of a record corn and soybean crop which makes upmoves in the market difficult.  For the week - September Corn was down 6-cents, December down 4 1/4, August beans were up 11 1/2 cents while November was down 8 1/2, September CH Wheat was down 25 1/2 cents, KC was down 17 1/2 and MN was also 24 3/4 cents lower.

Livestock futures were lower except for the feeder cattle which saw shortcovering into the close.  Funds were sellers again in the live cattle and the lean hogs with the technical trends being lower and product values softening.  Cash trade in the cattle was mostly $83 in the south and $132-133 in the north for the week.

Michelle Rook

Posted under Michelle Rook

Grains were higher for the day led by corn which was up nearly 20-cents.  USDA announced that the National Ag Statistic Service will resurvey corn farmers in seven states and that led to ideas that the agency would revise corn acreage by 500,000 up to 1 million acres.  As a result speculative buying and shortcovering pushed the corn market higher and the soybean and wheat markets followed.  Higher outside markets like crude oil and the DOW pushing past 9000 also aided the action.

Live cattle futures were higher on the rally in the stock market, higher boxed beef values and short hedge lifting with cash trade development in the northern feedlot areas at $132-133 which was steady to $1 higher than last week.  The south traded light volume at $83 down $1.  Feeders were lower on their premium to the cash and higher corn.

Lean hog futures continued to get pounded by fund selling and the futures premium to the cash trade in the August.  Increasing weights and slaughter numbers are also pressuring the cutout which is negative.

Michelle

Posted under Michelle Rook

It was another day of commodity wide selling in most of the grain and livestock futures markets.  The CFTC, which regulates futures trading, is currently talking about putting strict limits on the number of contracts index fund traders can hold and that caused some liquidation in most of the futures markets by index and traditional commodity fund traders.

Corn pushed to new lows again today on followthrough technical selling and continued favorable weather forecasts and crop conditions.  Some yield projections are starting to come out based on the crop conditions that have raised trendline yields to 162 bpa on the corn which set the market back as well.

Soybean traded two sided, but closed slightly higher.   When the market failed to make new lows and new crop November beans held key support that induced some shortcovering activity.

Wheat futures were sharply lower on technical selling and continued weak demand.

The livestock sector also experienced massive fund liquidation.  Some $84 cash cattle trade in KS was also a little bearish as it was steady with last week after ideas of higher money this week.  Hog futures continue to see pressure from the funds and the premium futures are carrying compared to the cash market.

Michelle Rook

Posted under Michelle Rook

Both grain and livestock futures saw two-sided trade for the day.  Live cattle were a good example, opening higher on technical buying after a higher weekly close and then quickly moving into the red on hedge pressure.  Futures finally ending mixed as spread activity took over.   Feeder cattle futures actually posted a reveral on the day with profit taking setting in after the higher opening.  Lean hog futures also traded both higher and lower, but settled in negative territory on the huge premium the futures are holding to the cash trade.

All the grains started higher on the day with technical momentum and buying tied to the higher close on Friday and overnight.  Corn futures managed to end slightly higher due to some light shortcovering and higher crude oil.  Meanwhile soybeans ended higher in the old crop contracts and lower in the new crop November contract on bull spreading.  Rumors of some export business on old crop soybeans to either China or Taiwan caused the spread activity and brought the commercial buyers into the pits.  Finally wheat ended lower on the day.  All three classes posted higher weekly closes last week and it looked like profit taking was the reason for the pressure in the market into the close.

Michelle Rook

Posted under Michelle Rook