top Farmer Midday Update 4-9-19

Corn: Corn futures are trading slightly higher in some follow through buying action today. May corn is up 1-1/2 cents to 3.61-1/2, Jul is up 2 cents to 3.70-1/2, and new crop Dec corn is up 3/4 of a cent to 3.90. Yesterday's USDA report was considered bearish, but also mostly know information. Old crop contracts put in new lows, but some speculative short covering likely helped lift prices in reversal type action. Winter storms beginning today will add to the market's perception that a late spring could ultimately reduce corn acreage this year. In addition, U.S./China trade negotiations are ongoing and the secretary of Purdue made comments recently that China and the U.S. have discussed reducing tariffs on ethanol products. Price action so far today has been relatively quiet. Jul corn traded up to its 10-day moving average resistance level and has since backed off a bit. New crop Dec corn pushed through its 10-day moving average resistance level, but has ultimately fallen back and is trading at the resistance level. Funds were net even in corn yesterday and are thought to be net short about 253,000 contracts.

Soybeans: Soybean futures are lightly higher in early trade today, with May beans up 2-3/4 cents to 9.01-1/2, Jul beans are up 2-3/4 cents to 9.14-1/2, and new crop Nov soybeans are up 2-1/2 cents to 9.34-1/4. Yesterday's successful test of nearby support levels was seen as a positive technical sign, and futures have shown similar price action so far today. Soybean contracts are making yet another test today of their 20-day moving average resistance levels. A close above would be the first since April 4, and considering three unsuccessful tests in a row would be another bullish technical sign. Yesterday's Supply and Demand report was considered neutral to slightly friendly. Still, it appears the USDA wants to wait out the ongoing U.S./China trade negotiations before they reduce soybean exports reflecting the recent slow pace. With African swine fever now in every province in China, as well as Vietnam, Mongolia, and Cambodia, there are growing worries about Asian demand for U.S. soybean meal down the road. Funds sold an estimated 2,000 contracts of beans yesterday and are thought to be net short about 79,000 contracts.

Wheat: Wheat markets are higher this morning and some short covering action after yesterday's bearish Supply and Demand report. July Chi wheat is up 1/2 of a cent to 4.64-1/2, Jul KC wheat is up 3/4 of a cent to 4.35-3/4, and Jul Mpls wheat is up 6-1/4 cents to 5.37-1/2. Yesterday's Supply and Demand report showed U.S. and world ending stocks coming in above expectations. World ending stocks came in even above the high end of the range of estimates. Some traders are expecting that winter storms this week will push back spring wheat planting. Winter wheat contracts traded lower early in the session, but held support at their lower Bolinger Band levels. Spring wheat futures found buyers right away and are making a test of their overhead 10-day moving average levels. Funds sold an estimated 6,000 contracts of wheat yesterday and are thought to be net short 64,000 contracts of wheat in Chi.

Cattle: Cattle markets are lower this morning, unable to draw much buyer interest from the rallying hogs so far today. Apr lives are down 5 cents to 125.85, Jun lives are down 52 cents to 119.82, and Aug lives are down 57 cents to 117.07. Apr feeders are down 85 cents to 145.30, and May feeders are down 95 cents to 149.22. Some cash cattle traded yesterday at 126.00, steady with last week and 1.00 higher than light cash trade on Monday. Blizzard conditions in the northern Plains beginning today will stress cattle and muddy the feedlots, but dryer conditions in the southern Plains may limit storm related buyer interest. Price action so far today looks tired, with nearby support levels unable to hold at this point.

Hogs: Hog markets are up this morning in more choppy trade, with Apr up 40 cents to 78.92, Jun up 1.57 to 96.72, and Jul up 1.72 to 99.70. Hog markets are trading with expanded limits due to yesterday's limit down closes, but are so far trading with relatively reserved price action. Jun and Jul futures both gapped lower to start the session, but quickly rallied up to close the gaps and are now moving towards yesterday's highs. The CME lean hog index and China nations spot pig prices are losing momentum higher for the moment, and it appears that hogs are trying to build a trading range before another move higher. Though exports to Mexico and China have slowed down for the time being, a trade deal with Mexico is expected to be complete before too long which should spark large purchases of U.S. pork products and tighten domestic supplies.




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