Corn: Up 3 to 5 cents
Soybeans: Up 3 to 6 cents
Wheat: Up 3 to 6 cents
General Comment: Grains and soybeans are rebounding slightly this morning after opening lower last night in response to the poor technical performances yesterday. Futures prices opened sharply higher Wednesday and then closed lower in wheat and corn and gave back half the gains in soybeans. While forecasts are turning drier, soils are the wettest they have ever been for this time of the year and that will keep the pace of planting slow, increasing talk that farmers may not plant as many acres as they said they intended to seed back in March and wet conditions increase the potential drag on yields. The race is on during the next 20 days to get as much planted as possible to capitalize on higher prices and remain eligible for the Market Facilitation Program payments.
Pockets of rain focused in parts of Illinois, Indiana, Missouri, Ohio, Wisconsin and eastern Iowa during the last 24 hours, with some lighter rains in South Dakota, Minnesota and northern Iowa. Part of the process for changing U.S. weather into something more favorable for crop development may be under way now, according to World Weather Inc. The change is expected to influence the entire continent and much of the change will be hinged on a developing high-pressure ridge in the central U.S. It won’t be completely dry, but a window of opportunity may be opening into the middle of June. The grain markets will likely remain choppy until next week.
Provoking trade disputes is "naked economic terrorism,” a senior Chinese diplomat said today, accelerating the rhetoric against the U.S. amid a bitter trade war that is showing no signs of ending soon.
China, the world’s largest soybean buyer, has put purchases of American supplies on hold after the trade war between Washington and Beijing escalated, according to Bloomberg News, citing people familiar with the matter. State-grain buyers haven’t received any further orders to continue with the so-called goodwill buying and don’t expect that to happen given the lack of agreement in trade negotiations, said the people, who asked not to be named because the information is private. Still, China currently has no plans to cancel previous purchases of American soybeans, the people said. Out concern remains the large quantities of both soybeans and cotton that China has purchases for this season and whether they will ship the commodities.
J.P. Morgan Chase CEO Jamie Dimon said that the escalating U.S./China trade dispute is a “real issue” that could damage corporate confidence, CNBC reports. “Trade has gone from being a skirmish to being far more important than that,” Dimon said.
USDA daily export sales reporting service did not report any new large export sales.
Corn: July futures spiked to the highest since it made contract highs on year ago and then closed higher. Yesterday’s high is now key resistance to clear to open up a new rally potential. Export demand is quiet, and traders will be looking for some improvement in ethanol demand last week in today’s weekly update. Export premiums at terminals near New Orleans were weaker yesterday. Demand at the Gulf is currently weak as some buyers turn to the southern hemisphere to buy cheaper supplies. The high-water woes look like they will continue well into June given the heavy rains in Missouri and Iowa overnight.
Soybeans: Futures are about 14 cents below yesterday’s high, which is now key resistance to clear. The escalating U.S./China trade tensions may cap gains in the near term.
Wheat: Prices bounced off the 100-day moving average last night. Wet weather remains a risk to winter wheat yields and quality. The Canadian Prairies have already been dealing with two years of drought and subsoil moisture is minimal in many areas. This is the third spring season with well below average precipitation has left many early planted crops stressed. Hot, dry weather will persist across Australia's east coast for at least another three months, the country's weather bureau said, in a forecast that threatens to severely crimp agricultural production.
Cattle: Steady to higher
Hogs: Steady to lower
Cattle: Futures seen opening steady to firmer, building on Wednesday’s rebound. Some light cash cattle sales took place yesterday in Kansas and Texas between $114 and mostly $115 and in Nebraska cattle traded steady at $116. Packers have been able to push prices lower in recent weeks, but feedlots may dig in for better prices this week. Boxed beef Choice prices rose yesterday to the highest since May 7 and Select cutouts are up $4.18 in the past week. Sales were strong Wednesday, confirming strong Memorial Day holiday sales at grocers.
Hogs: Futures seen steady to weak to start, giving back some of the gains on Wednesday. National average cash price slipped 51 cents on Wednesday as pork cutout values fall $1.48. Bellies and ribs were sharply lower as sales were moderately active. Trade waiting for weekly USDA Export Sales Report, which is delayed by the holiday to Friday.