Top Farmer Midday Update 7-19-19
Stewart-Peterson Commentary - SPC - Fri Jul 19, 10:45AM CDT

CORN: Corn futures have attracted buyers after yesterday's technical breakdown. Sep corn is up 6-3/4 cents to 4.31-1/4, Dec corn is up 6-1/4 cents to 4.36, and Mar corn is down 5-3/4 to 4.44. The corn markets are finding some overflow buying from soybean futures and rumors that U.S./China trade negotiations could be moving along, albeit very slowly. Weather through early next week will stay very hot and humid, but temperatures will cool off soon, just in time for pollination. Prices have surged back through the 50-day moving average levels, a major line in the sand that corn prices fell below yesterday for the first time since mid-May. Funds sold about 28,000 contracts of corn during yesterday's session.

SOYBEANS: Soy bean markets are up sharply this morning with Aug, Sep, and Nov contracts all trading 19-1/2 cents higher. Aug beans sit at 9.00-3/4, Sep is at 9.06-1/2, and Nov is at 9.18-1/2. There have been reports that the U.S. and China have had a second phone conversation on trade this morning. This is signaling that there is a possibility that the U.S. could send negotiators to Beijing soon. Still, odds of a deal anytime soon are still very slim. There is also talk that China has been an active buyer of South American soybeans for Aug and Sep delivery with maybe even a U.S. cargo or two included. Nov beans briefly tested their 50-day moving average support level this morning and then surged higher through their 10, 20, and 100-day moving average levels. Funds were thought to have sold about 1,000 contracts of soybeans yesterday.

WHEAT: Wheat markets are finding some recovery action along with the rest of the grains today. Sep Chi wheat is up 10 cents to 5.03-1/2, Sep KC wheat is up 9 cents to 4.41-3/4, and Sep spring wheat is up 5-1/2 cents to 5.31. U.S. wheat is trading at a major premium to wheat from the Black Sea and France and the U.S. dollar is higher today. Egypt bought wheat from Russia this week. There is not much fundamentally positive about these wheat markets beside a rising tide in the grain complex. In addition, all three wheat varieties were oversold coming into today so there is also some short covering action. Speculative funds sold 7,000 contracts of wheat in Chi yesterday.

CATTLE: Cattle markets are slightly higher so far today with Aug lives up 22 cents to 107.62, Oct lives are up 25 cents to 108.50, and Dec lives are up 35 cents to 113.15. Aug feeders are up 55 cents to 139.97, and Sep feeders are up 47 cents to 139.95. Boxed beef values were slightly higher yesterday afternoon and cash trade was mostly steady with last week. The market appears to be looking for confirmation that fundamental strength can lead the markets higher. The live cattle contracts are currently testing their 10-day moving average levels. These moving average levels were support levels broken yesterday. Feeder markets are trading back above their nearby resistance at the 50-day moving average level.

HOGS: Hog markets are holding triple digit gains this morning with Aug hogs up 1.30 to 84.07, Oct hogs are up 1.55 to 78.45, and Dec hogs are up 1.02 to 76.30. China pig values are up over 8% for the week, and carcass values have rallied sharply domestically over the past week. Futures markets are pushing through nearby resistance at the 50-day moving average resistance levels and the best traded Aug contract is trading at its highest value since June 11. The market's optimism about U.S./China trade negotiations is also a major positive factor. Hong Kong bought U.S.. pork last week and many believe that there will be more coming soon.




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