CORN HIGHLIGHTS: Corn futures finished mixed with front month Mar unchanged at 3.74-3/4 and Dec unchanged as well at 3.99-1/4, in a quiet trading session today. For the week, Mar futures moved 1/2 cent higher, while Dec futures were unchanged. Corn prices continued staying range bound in yesterday's push lower and has front month contracts testing the bottom of their trading range. As most short-term supplies seem ample, corn demand will stay clearly in focus as we move into the next few weeks. Yesterday's disappointing export sales numbers though dated nearly six weeks back, still brought a negative tone into the market overall. Today, daily export trade saw a sale of 8 million bushels to unknown destinations for the 2018/19 crop year. Pressure in the market saw South American weather continuing to improve and private analysts' estimates of Argentina crop could breech a record 46.5 million metric tons, as well as ongoing favorable weather conditions in Brazil's major corn growing regions may make price rallies limited. Corn futures have been in a long-term sideways trading range since December, with news in the market lacking at this stage, they will likely stay in that pattern in the near term. A close eye will be kept on other markets overall, as wheat futures have been under selling pressure the last couple sessions, which will also weigh on corn.
SOYBEAN HIGHLIGHTS: Soybean futures posted modest gains as contracts were 3 to 4 cents higher in today's trade. Front month Mar was 4 cents higher to 9.07-1/2, while Nov gained 4 cents to 9.52. For the week, the Mar contract posted a 7-cent loss, while Nov beans slid 5 cents. Though the export sales numbers this week were old, the strong amount of cancellations, especially from China, weighed heavily on bean futures yesterday. Ongoing trade negotiations and the prospects of continuing talks into next week back in the U.S. help bring some optimism and headline support into the market as prices held trend line support in the front months. Demand stays as a concern long term, as export sales and shipment numbers are running well below USDA expectations which may bring additional bushels to an already record carryout projection. One section of demand that is staying strong has been the U.S. crushing industry, as the NOPA released their January crush numbers this morning at 171.6 million bushels. This is the fourth largest month on record and well above expectations. Improving South American weather, as well as large burdensome U.S. supplies, will act as headwinds over the top of any soybean rallies.
WHEAT HIGHLIGHTS: Wheat futures were the pressure in the grain markets again today as Chi wheat contracts were 2 to 4 cents lower. Front month Mar was down 2-3/4 to 5.04-1/4, while Jul Chi was down 4 to 5.09-1/4. Weakness was seen across all wheat markets as Mar KC hard red winter wheat was down a nickel to 4.76-1/2, and hard red spring Mpls wheat was down 1-3/4 to 5.73-3/4. For the week, the Mar contract lost 13 cents in Chi, while the KC Mar contract was 17-3/4 cents pushing to new contract lows. KC wheat futures are struggling to find any traction as prices move to another contract low in today's trade. Despite the fact that all winter wheat acreage will be at a 110-year low, the prospect of burdensome supplies with U.S. total wheat carryout over 1 billion bushels acts as an anchor on the wheat market. In addition, strengthening of the U.S. currency recently versus competing exporters currency levels have weighed on wheat prices. As evident, the U.S. has lost some competitiveness on the export front as this week saw multiple tenders from importers go to other shippers besides the U.S. Continued weakness in the wheat market may see some additional long liquidation in technical selling if prices can't hold today's closes as we move into next week's action.
CATTLE HIGHLIGHTS: Cattle markets ended the week mostly lower, losing momentum after an extended rally. The nearby Feb live cattle contract closed 50 cents higher to 126.62, Apr closed 20 cents lower to 127.17, and Jun closed 20 cents lower to 118.07. Mar feeders were down 1.47 to 142.60 and Apr feeders were down 1.27 to 145.22. Choice beef values closed 37 cents lower yesterday afternoon to 216.07 but bounced 87 cents higher to 216.94. The relatively narrow choice-select spread of 5.44 indicates relative strength of low-quality beef cuts to high quality beef cuts. Cash trade today was seen as high as $127 in IL, though this was only for 100 head. It was disappointing that cash trade was published during the mid-trade session $2 higher than last week, yet still futures were unable to rally on this. Temps in the Plains next week will be very cold, but a lack of snow will limit cattle stress. Seasonal beef demand should turn lower as well. The best traded Apr live cattle contract faced early selling, pushing below the 10 and 20-day moving average levels. However, prices did close above their 20-day moving average support. Jun futures traded down to test their 10-day moving average support level but ultimately closed above. The real weakness today was in the feeder markets, with futures closing back below their moving average support levels. Lower Bollinger band support was held.
LEAN HOG HIGHLIGHTS: Hog markets had positive closes today, but finished the day well off of the session highs. The nearby Apr contract closed 82 cents higher to 59.52, Jun closed 25 cents higher to 76.72, and Jul closed 2 cents higher to 80.02. The CME Lean Hog Index was down 31 cents today to 55.24. Carcass cutout values closed 1.12 lower on Thursday afternoon to 62.76. This was the lowest carcass value since December 2009. Prices that low spurred buyers this morning, with carcass values up 2.08 at mid-session to 64.84. In stark contrast to U.S. pork values, Chinese pork values have bounced 9.7% off of the January 28 lows as many speculate supplies are tightening due to African swine fever losses. Once Chinese and Mexican tariffs come down on U.S. pork products, expect U.S. exports to surge. In the meantime, a hefty pork supply domestically is keeping prices pressured. Apr hogs rallied up today to test their 10-day moving average resistance level but were unable to break through. Jun futures tested and failed to close above their 20-day moving average resistance level.