After the Bell: Corn, Soybeans Rebound for Higher Weekly Close; Livestock End Mixed

Posted on Fri, 03/19/2021 - 14:39

Corn: May corn futures prices today rose 11 1/4 cents at $5.57 3/4 and for the week gained an impressive 18 3/4 cents. December corn futures on Friday rose 3 1/2 cents to close at $4.71 1/2 and for the week fell 7 1/4 cents. Not a bad week for the May corn futures market bulls as prices finished near the weekly high—suggesting some follow-through speculative and technical buying interest early next week. New-crop December corn continued to slip this week, however, and closed not far above the weekly low after hitting a more-than-two-week low earlier today. Friday morning USDA reported another daily U.S. corn sale of 800,000 MT to China. That follows the announcements of 696,000 MT Thursday, 1.124 MMT Wednesday and 1.156 MMT on Tuesday to China. The sales announcements this week should at least put a floor under the corn futures market next week.  

Soybeans: May soybeans rose 24 cents to $14.15 1/4 on Friday and November rose 13 3/4 cents to $12.20. May ended up 2 cents for the week but November fell 23 3/4 cents. May meal ended $7.20 higher this week at $407.90 after jumping $9.70 on Friday. Old-crop beans and meal finished higher this week after testing underlying support. Sharp losses Thursday allowed for end-users to extend forward coverage ahead of the March 31 USDA March 1 inventory and planting intentions reports. Trading is likely to remain choppy into the end of the quarter. Follow-through strength is needed to confirm the upturn in daily momentum studies today. Calendar spreads firmed and meal gained on soyoil, both positive signs. Cash basis continues to firm across the Midwest amid tightening supplies. New-crop futures were pressured this week by increased precip across the Midwest, boosting soil moisture but also likely to slow early planting progress with more rains forecast for next week.  

Wheat: SRW wheat futures settled midrange and 2 ¼ to 3 ½ cents lower today, with the front month down 11 ½ cents for the week. HRW wheat finished fractionally to 1 ½ cents lower today, with the May contract 18 cents lower on the week. Spring wheat futures posted gains of 1 ½ to 2 ½ cents.  Winter wheat futures tumbled over the past week after welcome rain and snow eased crop concerns on the Central and Southern Plains. But pressure on the spring wheat market was limited to some degree by recognition spring wheat can’t afford to lose many more acres to competing crops like corn and beans. Keep an eye on crude oil futures, as there are concerns a drop below Thursday’s low for the market could be a warning sign of a top for raw commodity futures, including grains.   

Cotton: Futures extended weekly declines on Friday. May futures fell 288 points this week to 84.68 cents and December fell 169 points to 82.51 cents. Cotton ended above session lows but still finished lower this week after failing to rise above resistance earlier this week. Cotton found some support from strong grain and soybean markets ahead of final planting decisions this spring.  Funds have been cutting long positions the past three weeks after futures hit new contract highs in February and reversed lower. The market continues to find light support from strong exports but much of that was factored into the rally earlier this year. Cumulative sales for 2020-21 have reached 14.227 million bales, down from 14.527 million last year at this time but the second-highest total since 2010-11. The five-year average is 11.845 million. Cumulative sales and shipments have reached 99.5% of the USDA’s forecast for the marketing year versus a five-year average of 89.7%.   

Hogs:  April hogs ended down a nickel on Friday to $94.25 and July futures were up 72.5 cents to $100.625. This week, April hogs rallied $2.85, and July was up $1.15. New contract highs this week were supported by stronger cash bids and rising fresh pork cutout values. The only negative this week was pork sales were sluggish at the higher prices. The CME lean hogs rallied $1.89 to $91.24, the highest since July 2017. The cutout values jumped $5.32 this week, touching the highest since May 2020. Big price gains essentially everywhere, even the lowly 42% lean trimming rising to a record. Weekly pork export sales released yesterday were very good at nearly 40,000 MT thanks to larger sales to Mexico of more than 18,200 MT. China bought just 5,800. Cumulative YTD sales are now above last year’s pace for the first time in 2020. Weekly shipments were also good at 39,600 MT last week. It’s more evidence of what’s been very good demand for several months now.   

Cattle: April live cattle futures closed the day down $0.175 at $118.40 today. June live cattle lost another $0.975 to close at $118.675 and for the week fell $1.75. May feeder cattle futures fell $1.95 at $144.675 and for the week lost $3.70. The key reversal down in June live cattle March 18, with May feeder cattle futures also posting a big reversal down—including technically bearish weekly low closes for both—set the table for some more selling pressure in futures early next week. June live cattle futures are also forming a bearish double-top reversal pattern on the daily bar chart. Cash cattle bids were mostly steady to firmer this week, but the downdraft in futures markets late this week has the attention of traders. Overseas demand for U.S. beef is on the upswing. Beef exports jumped to 25,900 MT last week, up 39% from the prior four-week average, with Japan, South Korea and China the top three buyers.