Stewart-Peterson Market Commentary

Closing Commentary - May 24, 2018

Top Farmer Midday Update 5-24-18

CORN: Corn futures have backed off their new highs at mid-session, but are quietly trading 1 to 2 cents higher, supported by technicals, fundamentals, and weather. Managed money put their buying hats on again overnight and are now seen net long well over 200,000 contracts. Jul corn peaked at 4.12-1/4 and is up 1-1/2 cents to 4.10. New crop Dec is up 2 to 4.28-1/2, a penny of the new high from the overnight session. This morning’s USDA Weekly Export Sales were as expected, at 854,300 tons (33.6 mil bu) for old crop, 273,400 tons (10.7 mil bu) for new crop. USDA also reported a cancellation of 132,000 tons of 2017-18 marketing year sorghum from an “unknown destination”. Crude is down 75 cents to a one-week low, and the dollar is consolidating/weaker following new highs on Wednesday.

SOYBEANS: Soybean futures are 5 higher to 10.44-1/4 (Jul). Jul beans have now surged above all moving averages and are up 57 cents since gapping higher on Monday. Nov is up 5-1/2 to 10.54-1/4. Markets remain optimistic on trade talks with China and rumors were abound yesterday that China was buying U.S. beans again. Meanwhile, the trucker strike in Brazil over rising fuel costs has also emboldened the spec money flows. Weekly Export Sales were 139,500 tons (5.1 mil bu) for old crop, 6,900 tons (253,531 bu) for new crop. We also had a morning new crop export sale announcement from the USDA showing 264,000 tons (9.7 mil bu) of beans going to an “unknown destination”.

WHEAT: Winter wheat are higher as the drought in the U.S. Plains translates to higher prices ahead of harvest. High heat is again expected in the region with dryness in Australia and Russia garnering market support, as well. Jul CBOT wheat hit a new high at 5.45-1/4 and is up 11 cents to 5.42. Jul KC wheat is up 10 to 5.61-3/4 ahead of that contract’s peak of 5.88-1/2. Weekly Export Sales were 112,300 tons for old crop, and 340,000 tons for new crop.

CATTLE: Cattle futures are narrowly mixed, consolidating from recent gains as the trade looks ahead to tomorrow’s Cattle on Feed report, and a 3-day holiday weekend. Jun cattle are down 0.175 to 105.275. Aug is up 0.200 to 103.000; and May feeders, which expire today, are sharply higher, up 1.225 to 136.125. Aug feeders are up 0.900 to 144.250.

HOGS: Hog futures are off slightly with Jun hogs down 0.075 to 74.525, Jul down 0.025 to 76.200, and Aug down 0.025 to 75.000. Yesterday’s sharp gains have prompted profit-taking today, and technically, contracts are leaning more bearish after breaking out of a narrowing, sideways trend to begin the week. Trading is light with many participants stepping to the sidelines ahead of the long weekend. Cash hogs look weaker today.




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