Top Farmer Closing Commentary

CORN HIGHLIGHTS: Corn futures were unable to hold onto much strength today, with Dec down 2-1/2 cents to 3.75-1/4. Mar corn was down 2-1/2 to 3.84, and May corn was down 3 cents to 3.89-3/4. Yesterday afternoon’s Crop Progress report was supportive today but unable to stir up much buyer interest. The corn is 66% harvested as of Sunday afternoon, versus the average market guess of 68%. Harvest activity will remain slow for the next couple of weeks with forecasts for above normal temperatures and above normal precipitation keeping fields muddy. Brazil’s corn acreage is expected to come in about 1% ahead of last year. U.S. corn basis is firm, and the Dec to Mar spread narrowed by 1/4 cent today, as end users are finding it difficult to procure supplies. Dec corn traded within a quiet inside session today, only within a range of 2-3/4 cents. Mar and May corn also made inside sessions, and all three contracts are oversold.

SOYBEAN HIGHLIGHTS: Soybean futures were slightly lower today, with Nov down 3-1/4 to 9.02-1/2. Jan beans were down 1-3/4 to 9/15-1/4, and Mar beans were down 1-3/4 to 9.28-1/2. Yesterday afternoon’s Crop Progress report was supportive, with 85% of the soybean crops harvested, versus the average market guess of 87%. Brazil’s Ministry of Agriculture Supply department increased its projections for Brazil’s 2019 soybean plantings to 36.7 million hectares, 2.3% above last season. This is likely spurred by the improving weather and planting pace that is quickly catching up. The best traded Jan contract was trapped today between its 100-day moving day average support level and its 50-day moving average resistance level. Prices made a bearish outside day, and though not a major development, the trend is still lower. Most soybean futures contracts are oversold at this point, though head-and-shoulders formations still point lower.

WHEAT HIGHLIGHTS: Wheat markets found a swift correction from yesterday’s strength, with Dec Chi down 8-1/2 cents to 5.08-1/2. Dec KC wheat was down 14 cents to 4.24-3/4, and Dec spring wheat was down 6-1/2 to 5.15-1/4. The U.S. dollar was slightly higher today, continuing its recent uptrend and keeping the pressure on the global wheat crop. Winter wheat plantings came in at 92% yesterday afternoon, versus the average market guess of 93%, and winter wheat conditions were seen lower than expected, reported at 54% good to excellent, versus the average market guess of 57% good to excellent. The big story yesterday was the strength of the KC / Chi spread, but that spread corrected hard today. In Dec, the KC / Chi spread made a bearish key reversal and has started to return from overbought levels. That spread was down 6 cents, and a Mar spread was down 3-3/4. Dec Chi wheat was unable to hold yesterday’s close above the 10 and 20-day moving average levels and fell back below today. Dec KC wheat closed above its 100-day moving average level for the first time since July but promptly fell back below. Dec spring wheat made an inside session enclosed just off the lows of the day.

CATTLE HIGHLIGHTS: Cattle markets made a sharp break lower today, with Dec lives down 1.65 to 118.10. Feb lives were down 1.47 to 124.10, and Apr lives were down 30 cents to 126.75. Nov feeders were down 2.22 to 145.47, and Jan feeders were down 4.30 to 142.82. A few head of cattle were sold today in Kansas and Texas at 115, steady to slightly higher from last week. Technically, cattle markets had a bit of a breakdown today. Dec lives closed below their 10-day moving average level for the first time since September 10 and retested their 20-day moving average support level for the first time since September 17. Feb lives also closed below their 10-day moving average for the first time since September 10. Jan feeders closed below their 10 and 20-day moving average levels for the first time since September 10 as well.

LEAN HOG HIGHLIGHTS: Hog markets were lower today, with Dec down 1.60 to 63.12. Feb hogs were down 1.00 to 74.55, and Apr hogs were down 27 cents to 81.75. The CME lean hog index was down 50 cents to 58.94. Carcass cutout values closed 2.19 higher yesterday to 88.53 and were down 1.32 at mid session today to 87.21. The break in pork values is likely the reason for the selling today, especially given the choppy cash pig prices lately and the downtrending China spot pig prices. Dec lean hogs made a bearish outside session today, briefly testing their 10 and 20-day moving average levels but closing below yesterday’s lows. Feb hogs made a bearish key reversal today, and Apr hogs posted their second consecutive close above the 20-day moving average for the first time since late October.




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