Top Farmer Midday Commentary 7-9-19

CORN: Corn futures are taking losses this morning with Jul, Sep, and Dec corn down 7-1/4 cents to 4.31-3/4, 4.32-1/4, and 4.36-1/2 respectively. Prices are finding some selling pressure partly on yesterday afternoon's Crop Progress report. Good to excellent ratings increased 1% over last week, now sitting at 57%. 98% of the corn is emerged vs 94% last week. Another source of pressure this morning has been weather forecasts. The 6 to 10 day outlook shifted from hot and dry to hot and mixed precipitation, while the 8 to 14 day forecast is now showing above normal temperatures and above normal precipitation. This should be beneficial for plant growth and is thus bearish for prices. Dec futures are trading back below their 10-day moving average level after yesterday's close above. A head and shoulders pattern is forming which could indicate lower prices later on. During yesterday's session, funds bought about 5,000 contracts of corn.

SOYBEANS: Soybean futures are mixed to mostly lower with Jul beans down 1/4 of a cent to 8.75, Aug beans are up 1/4 of a cent to 8.79-1/4, and Nov beans are down 1/2 of a cent to 8.97-1/4. Against expectations, soybean crop conditions actually dropped on yesterday's Crop Progress report. 53% of the soybean crop is rated good to excellent vs 54% last week. That is surprising due to the solid weather seen for most of last week. Despite President Trump's claim that China would restart large purchases of U.S. agricultural goods, news wires with such purchases have been quiet and many are beginning to wonder if these purchase will restart anytime soon. Nov beans traded to new lows for the move early on in the session, but have since rebounded. Nearby support lies at the 50-day moving average at 8.88-1/4. Funds were thought to have bought about 1,000 contracts of beans during Monday's session.

WHEAT: Wheat markets are finding sellers this morning after unsuccessful tests of resistance levels yesterday, as well as improving crop conditions. Sep Chi wheat is down 8-1/2 cents to 5.02-1/2, Sep KC wheat is down 6-3/4 cents to 4.34, and Sep Mpls wheat is down 5-1/2 cents to 5.27. Winter wheat conditions went from 63% good to excellent last week to 54% good to excellent this week. For this same week last year, just 37% of the winter wheat crop was rated good to excellent. 78% of the spring wheat is now rated good to excellent vs 75% last week. Weather in the Plains looks perfect for harvest activities though Chi wheat areas should get some rain over the next 8 to 14 days. Chi wheat contracts were unable to break above their 200-day moving average resistance level yesterday and the KC wheat contracts were unable to break through their 50-day moving average resistance. Winter wheat contracts are still in a consolidation pattern while the spring wheat contracts have fallen to new lows for the move. Funds sold 3,000 contracts of Chi wheat yesterday.

CATTLE: Cattle markets are higher this morning, holding onto nearby support levels. Aug lives are up 70 cents to 106.85, Oct lives are up 42 cents to 107.82, and Dec lives are up 40 cents to 112.27. Aug feeders are up 1.40 to 140.30, and Sep feeders are up 1.40 to 140.15. Despite the lowest beef prices since February, live cattle futures were able to hold their 50-day moving average support levels at yesterday's close. Live cattle futures have still not closed the gap created from Friday's session, and with good weather ahead, retail beef demand should begin to pick up noticeably. Feeder markets are likely finding buyers today on weaker corn prices, as well as a growing sense of optimism in the live cattle space. The best traded Aug feeder cattle contract is trading at its highest level since June 11.

HOGS: Hog markets are higher this morning, stabilizing hear recent lows. Jul hogs are up 95 cents to 71.02, Aug hogs are up 3.00 to 79.07, and Oct hogs are up 2.77 to 70.77. Though carcass cutout values continue to drift lower, good weather ahead should spur some retail pork demand. China's national average spot pig price is up nearly 2.5% on the week. China has yet to make sizable ag purchases from the U.S. lately. Many are doubting that this will happen anytime soon, but pork will likely be on the shopping list. Oct hogs made new lows for the move, hitting their lowest prices since February 20, but have since reversed higher mid-morning.

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