DAILY GRAINS RECAP:
September contracts of all three U.S. wheat prices finished with double-digit gains Thursday, a likely bout of short-covering that may have been helped by higher export sales. December corn ended down 2 3/4 cents and November soybeans were down 2 1/4 cents, both cautiously falling to new lows ahead of Friday’s Acreage and Grain Stocks reports.
CORN:
December corn ended down 2 3/4 cents at $4.33 3/4 Thursday, falling to its lowest December prices in three years as traders continue to ignore obvious obstacles to U.S. corn production in 2024. On the bearish side, USDA could estimate 90 million acres or more of corn planted on Friday and moderate rains are expected to help ease dry conditions across the Eastern Corn Belt the next seven days. On the bullish side, the heaviest rain amounts the next seven days will stretch from North Dakota and Minnesota to northern Missouri and eastern Kansas, including areas still hurting from weekend floods. Keep in mind USDA’s planting estimates will include acres planted once and sometimes twice, no matter what condition those acres are currently in.
It is difficult to explain funds’ bearish enthusiasm in late June, but the trend in December corn remains down.
SOYBEANS:
November soybeans ended down 2 1/4 cents at $11.04 3/4 Thursday, extending its lowest November prices in over three years with USDA’s Acreage and Grain Stocks reports due out Friday at 11 a.m. CDT. This month’s selling pressure has come from stiff export competition from South America and anticipation that USDA will estimate more than 86.5 million soybean acres planted in 2024, partly a result of corn planting difficulties this spring. Also, this week’s rains across the eastern Midwest helped ease concerns about dry conditions there and more moderate rains are expected in the region the next seven days. Traders have largely ignored flooding concerns in the northwestern Corn Belt and traded on the theory that rain makes grain, an assumption that may be challenged later in the season when crop estimates take shape. With a bigger U.S. soybean crop still expected in 2024 and while specs remain bearish, the trend remains down for November soybeans.
WHEAT:
September KC wheat closed up 12 1/4 cents at $5.96 3/4, the largest daily gain the market has seen since May. We can’t confidently say wheat prices won’t go lower, but the selloff in June has been extraordinarily harsh, even for wheat, at a time when many are expecting smaller wheat crops from Europe, Ukraine and Russia in 2024. Here in the U.S., the winter wheat harvest is making progress with a wide variety of yields found in Kansas. Overall conditions remain better than a year ago, but USDA’s wheat production estimate is only 63 mb higher in 2024-25, due to fewer acres. USDA’s Acreage report will update wheat planting estimates Friday with most of the attention on spring wheat. Dow Jones’ survey estimated 11.36 million acres of spring wheat plantings, up slightly from last year’s 11.20 million acres. More heavy rains are expected in North Dakota and Minnesota the next seven days, while drier conditions have hurt crop ratings in the Pacific Northwest. With noncommercials leaning bearish in wheat, the price trends remain down for the July contracts of all three U.S. wheats, but prices are fundamentally cheap.
LIVESTOCK DAILY RECAP COMMENTS:
The lean hog contracts are traded lower as the market anxiously waits to see what this afternoon’s Quarterly Hogs and Pigs report shares, but the cattle complex was hopeful that cash cattle prices are going to trade higher again this week, so the nearby live cattle contracts and the entire feeder cattle contracts traded higher into the noon hour, but ultimately gave into pressure and finished lower.
LIVE CATTLE:
The nearby live cattle contracts started higher as the market is anxiously tapping its toes, waiting to see what feedlot managers do with this week’s cash cattle trade, and other than the soon to expire June contract, finished lower on the day. Asking prices are noted in the South at $192 to $194, and in the North at $315 plus, but still no cattle have traded as packers know that they’re currently at the mercy of feedlots given that supplies are so current. Packer demand will likely improve throughout the afternoon, but it’s likely that the bulk of the week’s trade will be delayed until Friday as feedlots are aiming to advance the market again this week.
FEEDER CATTLE:
With the market growing more and more confident in the fact that fed cash cattle prices will trade higher again this week, the feeder cattle contracts were trading fully higher into Thursday’s noon hour. Between the additional market support that’s seeping over from the live cattle contracts and their slightly higher tone to the continued support of tremendous feeder cattle demand in the countryside amid slightly lower corn prices — feeders are ready for action as the market’s horizon is bright and lined with ample support.
LEAN HOGS:
As the lean hog complex patiently waits for this afternoon’s Quarterly Hogs and Pigs report, traders are leery of doing much of anything ahead of seeing what today’s report yields. The morning’s export report was fruitful however as the week’s exports totaled 39,200 metric tons, which is especially encouraging right now as the market is desperate for demand — in any shape and form.
