After the Bell: Beans Rise On Positive China Trade Reports; Grains Mixed

Posted on 12/04/2019 2:33 PM

Corn: Corn prices fell for a second session after failing to break overhead resistance to start December. March corn futures dropped 2 ¾ cents to $3.78 ½. The market was pressured by 129 deliveries against the expiring December futures overnight after no deliveries to start the process. Weather leans negative with rains boosting first-season corn and a few showers forecast for Argentina. But dry pockets remain in Argentina and those showers are critical with a dry January forecast. U.S. harvest will make some progress with drier weather into the weekend. U.S. ethanol production rose for an 10th straight week but failed to hold production above last year after rising above 2018 output a week earlier for the first time since April. Ethanol stockpiles rose sharply last week.

Soybeans: Futures rose for a second session after plunging more than 90 cents in five weeks to near a 12-week low to start December. January soybeans rose 7 cents to $8.78. January meal rose $2.00 to $296.70 and soyoil futures gained 28 points to 30.47 cents. According to a new Bloomberg News report the U.S. and China are moving closer to agreeing on the number of tariffs that would be rolled back in a phase-one trade deal, and on Chinese agricultural purchases. Dalian soybeans jumped more than 25 cents overnight in China. President Donald Trump's son-in-law Jared Kushner has added another role to his long list of White House duties -- U.S.-China trade negotiator-- as Washington and Beijing try to reach an initial agreement to avoid new U.S. tariffs on Dec. 15. People familiar with the talks told Reuters that Kushner, who helped bring the U.S.-Mexico-Canada trade agreement (USMCA) to fruition, has increased his direct involvement in the negotiations with China over the past two weeks.  

Wheat: SRW wheat futures rose around 2 cents in most contracts, HRW futures firmed mostly 3 to 4 cents and spring wheat futures ended mostly around a penny higher. Winter wheat futures mildly bounced back from sharp losses the first two days this week after failing to find sustained seller interest under Tuesday’s lows. The bulk of today’s price rebound was corrective in nature and traders showed no conviction behind the late buying, meaning the market will be searching for price direction tomorrow.  

Cotton: December cotton futures closed up 7 points at 63.17 cents and March futures gained 65 points to 64.70 cents. March futures closed nearer the session high. Cotton traders continue to key off news headlines regarding U.S.-China trade talks. Today’s headlines were more optimistic for a China deal. According to a new Bloomberg News report the U.S. and China are moving closer to agreeing on the amount of tariffs that would be rolled back in a phase-one trade deal, and on Chinese agricultural purchases. Washington and Beijing are trying to reach an initial trade agreement to avoid new U.S. tariffs kicking in on Dec. 15. Still, sealing a deal with the China could prove daunting. China warned the U.S. over a U.S. House of Representatives bill calling for a tougher U.S. response to Beijing's treatment of its Uighur Muslim minority.

Hogs: After swinging wildly in either direction the past three days, lean hog futures saw a quieter day of trade. December futures settled 62 ½ cent lower, while deferred months closed high-range and up 5 to 87 ½ cents after a gap-higher start for several contracts. Most lean hog contracts enjoyed some followthrough buying after yesterday’s strong move to the upside. A dip in the U.S. dollar index to its lowest level in a month and more positive U.S./China trade headlines helped the market to favor the upside. The exception was the front-month, which faced pressure as traders worked to narrow the contract’s premium to the cash hog index. As of today’s close, that premium stood at roughly $4.50. Cash hog bids have recently moved higher, which is also helping to narrow the gap.

Cattle: February live cattle futures ended the down $1.475 at $124.175. December futures lost $1.10 at $119.45. January feeder cattle futures fell $1.50 at $140.875. All contracts finished near session lows. Some more profit-taking in the futures market was seen in live cattle today. Boxed-beef cutout prices slumped again Wednesday, with Choice down $2.57 and Select off $1.53, on movement of 89 loads. The Choice-Select grade spread was $16.80 today. The drop in cutout value this week is leading to ideas packer bids in the cash market will come in lower this week. Still, some believe packers need inventory this week and will bid up for cash cattle.

Add new comment