Top Farmer Midday Update 7-12-19

CORN: Corn futures are trading firmer with contracts 7-8 cents higher. The market is seeing some follow through buying after yesterday's strong close after the USDA Supply and Demand report. The market is maintaining a lot of indecision regarding acreage until resurveyed numbers are published on the August 12 report, end users are stepping into the market and trading weather forecasts. Hot conditions across the grain belt are expected over the next 6-10 days, which may stress already weakened crops due to difficulties this spring.

SOYBEANS: Soybean futures are currently trading 5-6 higher on follow through buying after yesterday's Supply and Demand report. The USDA reduced carryout projections on reduced acres and yield in yesterday's report, and strength seen in corn and wheat markets are helping bring additional money flow and short covering. The bean market may be focused on upcoming weather forecasts with hot conditions potentially damaging a weakened crop. Crop ratings last week slid, and weather stress may have those ratings slide even farther into next week.

WHEAT: Wheat markets are trading slightly higher, with prices showing marginal gains of 1/4 to 1 cent higher. Wheat futures are struggling to show follow through after yesterday's strong gains, as the USDA lowered world production by 10.5 million metric tonnes due to weather conditions affecting yields in key exporting countries. U.S. supplies saw some mild reductions according to expectations due to increased demand on the feed usage and export front, but ongoing harvest keeps a lid on gains in the short term. Wheat futures may stay in consolidation mode until a clear picture on the U.S. supply pile is accomplished, as harvest begins to wind down in the next couple of weeks.

CATTLE: Cattle futures are trading mixed. The front month Aug cattle is 30 cents higher to 108.17-1/2. Retail values have been disappointing this week, as cutouts have trended lower on a day-to-day basis. Cash trade is still relatively undeveloped, but early indications are for dressed trade to be slightly higher and bids firming, which is supportive on the front month contracts. Feeder cattle are posting triple digit losses, with Aug feeders down 1.42-1/2 in today's trade, as strength in the grain market has put a pause on the rally seen on feeder cattle over the week.

HOGS: Hog futures are trading mixed. Front month Jul hogs are getting close to expiration and are trading 10 cents lower to 71.50, as weakness in cash and retail values this week have made it difficult for front month prices to move higher. Anticipation of improved demand has Aug through Feb contracts pushing 1.00+ higher with Aug at 80.22-1/2, up 1.05. The hog market is anticipating a move through heavy supplies into a more manageable production cycle, plus the prospects of heat across the Midwest bringing some premium into the front month summer contracts.




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