After the Bell | Aug. 11, 2021
Corn: Corn futures finished in the upper portion of today’s range with gains around 6 cents in the most actively traded contracts. Traders covered some short positions in the corn market today as they prepared for tomorrow’s Crop Production and Supply & Demand Reports from USDA. Traders expect USDA’s first survey-based corn estimate to come in around 15 billion bu. on a yield of 177.6 bu. per acre, based on a Reuters survey. Both would be down slightly from USDA’s projections in July. Old-crop corn ending stocks are expected to be higher than last month, while projected new-crop carryover is expected to decline.
Soybeans: November soybeans closed up 3 1/4 cents at $13.40 today and nearer the session low. December soybean meal closed down $3.00 at $356.50 today and also nearer the session low. December bean oil closed up 98 points at 61.60 cents today and near midrange. More U.S. soybean sales to China were announced today, keeping sellers in soybean futures on the sidelines. USDA reported a daily sale of 132,000 metric tons (MT) to China for 2021-22, the fifth consecutive day of soybean sales to China and/or unknown destinations. However, gains in the soybean complex were limited by better rain chances later this week and next week. Worldwide Weather Inc. today said there may be some rains in store for the dry northwestern Corn Belt later next week. “The event is still a full week away, but if these models are correct some significant rain may fall in the drought stricken areas” of the upper Midwest, World Weather said, adding that caution is warranted.
Wheat: Trader positioning ahead of Thursday’s USDA reports likely caused wheat futures to set back today. December SRW wheat skidded 1/4 cent to $7.39 1/4 per bushel, while December HRW dipped 4 cents to $7.22. Meanwhile, December HRS futures sagged 1 3/4 to $9.00 1/2. Wednesday’s decline in the wake of recent gains likely resulted from traders evening up positions ahead of USDA’s weekly Export Sales report, USDA’s monthly WASDE release and its August Crop Production report coming out at various times tomorrow morning. Much depends upon the published results. Traders will particularly be looking for the past week’s sales to China, projections for the latest harvests of U.S. and Canadian spring wheat, as well as the latest Russian harvest estimate.
Cotton: Cotton futures sagged Wednesday, likely reflecting profit-taking by bulls ahead of tomorrow’s weekly USDA Export Sales, monthly WASDE and August Crop Production Reports. The December contract settled 1.03 cents lower at 91.29 cents/pound. After rallying to fresh contract highs Tuesday on anecdotal yield reports from southern Texas, despite general indications of a very good forthcoming harvest, cotton futures are quite high by historical standards. Indeed, a look at the long-term charts serves as a reminder that the cotton market has had great difficulty sustaining moves up to and through the 95.00 cent level. Demand has apparently proven phenomenally strong through much of 2021, but many traders now worry that the elevated prices reached lately will strangle that buying. Thursday’s early Export Sales report will offer fresh insights on that point.
Hogs: October lean hogs closed up $1.975 at $85.85 today and near the session high. The futures market saw short covering after hitting a four-week low Tuesday.: The lean hog futures traders today decided to focus less on bearish seasonals of higher pork supplies in the fall and more on the bullish aspects of higher wholesale beef prices also supporting the pork market in the coming weeks. A big gain in the pork cutout at noon today was also supportive for lean hog futures. The noon pork report showed hog carcass cutout value rose a solid $7.81 to $130.21, led by gains in hams. Movement was decent at 168.37 loads.
Cattle: Live cattle futures finished 12 1/2 to 70 cents lower through the February contract. Feeder cattle closed 22 1/2 to 55 cents lower through the January contract. Live cattle futures were pressured by a disappointing start to this week’s cash cattle trade. Light trade started in the $121 to $122 range this week. While trade in the northern market should be higher and pull the average price up, packer demand is said to be limited. As a result, traders expect the average cash price to fall from $123.83 last week. August live cattle finished today at $122.95, signaling traders anticipate a slightly lower average cash prices when all is said and done.
