Stewart-Peterson Market Commentary

Closing Commentary - March 21, 2018

Top Farmer Midday Update 3-21-18

CORN: Corn futures are narrowly mixed as the corn trade begins to level off 15 to 20 cents from recent highs. May and Dec corn is unchanged at 3.74 and 3.97-1/4, respectively. Today’s Weekly Ethanol Stats showed 109.12 mil bu of corn used in last week’s ethanol production, 4.62 mil bu more per week needed to meet USDA’s annual usage estimate of 5.575 bil bu. Weekly Export Sales are on tap for tomorrow morning. We did get a morning export sale announcement from USDA showing 138,000 tons (5.4 mil bu) of 2017-18 corn going to South Korea. Crude is up 43 cents, the dollar down 22 points.

SOYBEANS:Soybean futures are quietly trading 6 cents higher in the old crop contracts, 3 to 4 higher in new crop. May beans are at 10.34-3/4 while showing signs of completing a technical correction off of the early March highs. Nov beans are at 10.28. Initially, open interest declines appeared light following Monday’s losses, but further declines were seen in yesterday’s session with corn down around 18,000 contracts, and beans and meal down around 7,000 despite player sheets claiming funds were net buyers in beans and meal. So, at this stage, we are holding just above the halfway point of January’s low to most recent highs in the corn, beans, and meal. In the news, Chinese tabloid Global Times talked about the unfair practice of the dumping of U.S. beans on China. The widely-read state run Global Times is run by the ruling Communist Party's official People's Daily, although its stance does not necessarily equate with Chinese government policy; its comments come as U.S. President Donald Trump is expected to announce tariffs against Chinese imports.

WHEAT: Wheat futures are seeing more downside movement and new lows for the move at all three grain exchanges, as the trade acts on the presumption that the latest hit to the Weekly Crop Ratings did not take into account last weekend’s weather. For now, the U.S. Plains saw no major changes as an active system is to bring above average precipitation to much of the Plains in the next 10 days; only the panhandles and southwest Kansas are to see light amounts of rain; above average temps are seen for the Plains. May CBOT wheat made a new nearly two-month low of 4.48-1/4 on losses of 4-3/4 cents. May KC wheat fell to 4.61 for the first time since January 29, on losses of 9 cents. Sep MPLS wheat, down 3-1/2 cents to 6.07-3/4, is at that contract’s lowest point since last June.

CATTLE: Cattle futures continue to soften today with nearby fat cattle losing another buck. Apr is down 1.225 to 118.350, further distancing the contract from cash, as well as breaking down technically. Today’s Fed Cattle Exchange saw the only two lots offered sell for $125 and $126/cwt amid signs that showlists are dwindling. Jun cattle are down 1.000 to 108.000, a fresh 6-1/2 month low. Apr feeders are the only cattle contract in the black, up a mere .050 to 137.500. We’ll get the next Cattle on Feed report after the close on Friday.

HOGS:Hog futures remain narrowly mixed at mid-session. Reminiscent of Tuesday’s trade, we’ve seen early downside probing to new lows, followed by some light buying interest amid ideas of the market being technically oversold. Cash is again lower today, limiting buying interest in futures. Apr hogs are up .075 to 63.425, May up .200 to 70.400; and Jun is up .9050 to 76.800.

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