Top Farmer Midday Commentary 5-1-19

Corn: Corn futures are trading higher today, likely finding some short covering from speculative fund traders. May corn is up 2-3/4 cents to 3.56, Jul corn in up 2-1/2 to 3.65, and new crop Dec corn is up 2-3/4 cents to 3.83-3/4. With 6-10 and 8-14 day forecasts still showing above normal precipitation, traders who are short corn may be growing a little nervous about planting delays. Weather in May can turn quick, but moisture could still delay progress. Yesterday's closes, though mostly mixed, were well off the sessions high and especially impressive considering selling pressure in soybean and wheat markets. Today, wheat markets are higher providing some overflow buying. Corn prices rallied as high this morning as their overhead 20-day moving average levels. Dec traded as high as 3.85-1/4, but has since backed off a bit as prices were unable to push through resistance. Funds sold about 1,000 contracts of corn yesterday and are thought to be net short about 310,000 contracts.

Soybeans: Soybean futures are moderately lower again this morning, with May down 5-1/4 to 8.36, Jul down 6-1/2 to 8.47-1/2, and new crop Nov down 6-1/4 to 8.68-1/2. May through Sep contracts are trading at new lows again today, and Nov beans are trading at their lowest levels since July 16. The Nov contracts all-time low is at 8.64-3/4, well within striking distance. Heavy rains across the Corn Belt are delaying corn planting, and giving many traders the idea that certain areas could begin to shift acreage to soybeans on further delays. Argentina port offers are currently about 34.00 per ton cheaper than U.S. and Brazil port offers. The Argentine peso is at an all-time low. Funds sold about 7,000 contracts of soybeans yesterday and are thought to be net short about 152,000 contracts.

Wheat: Wheat markets are higher today, possibly finding some short covering so far. Jul Chi wheat is up 4-1/4 cents to 4.34, Jul KC wheat is up 4-1/4 to 3.98-1/4, and Jul spring wheat is up 4-1/2 to 5.11-1/2. The KC Wheat Tour has shown that wheat is in generally good shape though showing signs of delayed maturity. This could leave the wheat vulnerable to weather stress in the coming weeks. Keeping with mixed to negative fundamentals, Russian wheat prices were down 4.5% last week and yield estimates from satellite imagery firms our increasing for the U.S. winter wheat crop. Funds sold about 5,000 contracts of wheat in Chi yesterday and are thought to be net short about 79,000 contracts.

Cattle: Cattle markets are mixed to mostly higher in very quiet trade today. Jun lives are up 27 cents to 114.52, Oct lives are up 2 cents to 112.35, and Dec cattle are up 32 cents to 116.35. may feeders are up 65 cents to 142.25, and Aug feeders are up 87 cents to 150.02. Recent selling pressure has left prices shortly oversold, so the price recovery today has been very muted. Both beef and cash cattle have been trending lower recently, keeping dip buying quiet thus far. It is still unclear what portion of speculative funds long positions have been liquidated since the turn lower last week, but open interest has been coming down quickly in recent sessions.

Hogs: Hog markets are sharply higher this morning after testing and holding near term support levels in recent sessions. Jun hogs were up 2.92 to 91.15, Jul hogs are up 2.62 to 95.00, and Aug hogs are up 2.62 to 95.70. The best traded Jun hogs contract has tested and held its nearby 50-day moving average support level and has found buyers today on the stabilizing price action. Prices are still oversold after the sharp trend lower in recent weeks, also contributing to the surge today. Cash and pork values have been mixed to mostly lower recently, making today's price action looking mostly technical in nature. There are rumors that Chinese pork buyers will slow down purchases until tariffs are struck down, but reports from yesterday's U.S./China trade negotiations do indicate progress was made.




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