News Source: SPC

Top Farmer Closing Commentary 5-14-21

Grain - Corn Field Sunny Sky Shoots

CORN HIGHLIGHTS: Corn futures were under pressure again today as front months lead the way lower. Today was the last trading day for May futures which closed 34 cents lower ending the session at 6.85. July also finished sharply lower closing 31 cents weaker at 6.43-3/4 and losing 88-1/2 cents for the week. New crop December ended the day at 5.42-3/4 and lost 15-1.2 cents. For the week, futures dropped just over 93 cents. New contract highs were scored in July corn futures on May 7 at 7.35-1/4, a week ago Friday. Not a very impressive week as futures lost all last week’s gains and then some. It was also noted that China may have purchases as much at 150 mb this week for delivery into the new marketing year. Supporting prices is continued concern of crop losses in Brazil. Yet, bullish traders were probably disappointed this week when the USDA report did not indicate as much drawdown in production as many were hoping for. In addition, many analysts were looking for demand increases and those were not there either. Bottom line, the report was supportive the old crop but not as supportive as many were looking for after last week’s price surge. The weather has taken a general turn for the better in the Midwest with continued above normal temperatures forecasted, but also above normal precipitation for much of the southern 2/3 of the Midwest. It looks like the North will remain mostly dry. After a couple of weeks all bets are off as weather becomes more critical. At this point we would argue that regions very short on moisture are getting some relief but that low subsoil conditions are concerning.

SOYBEAN HIGHLIGHTS: Soybean futures ended the session higher with July gaining 2-1/4 cents and November adding 5. Strong early session double-digit gains eroded late in the session, as corn prices plunged again today. July closed at 15.86-1/4, ending the week down 3-1/2 cents and well off the high of 16.67-1/2, while November futures finished at 14.00-3/4, down 32-3/4 cents for the week and well off the high of 14.61. Weekly charts posted negative hook reversals. Today was the last trading day for May futures, and it went off the board at 16.03-3/4, down 8-1/2. It was quite the rollercoaster ride for soybeans this week, yet the overall uptrend remains fully intact. While prices did slide, critically tight carryout continues to be the primary concern on the big picture. The USDA did confirm the 2020-2021 crop year carryout at a snug 119 mb, and the 2021-2022 forecast for carryout at a similar snug 140 mb. It is a long time before next year, and with two growing seasons ahead of both world supply and demand, the long-term projection shows little chance for supply buildup. Therefore, we continue to look for opportunities to market for the year ahead but currently will do so very cautiously. As we indicated in previous reports, there is no room for error in producing this year’s crop. We do expect acreage will be higher than the current estimate of 87.6 million.

WHEAT HIGHLIGHTS: May Chi wheat up 3/4 cent at 7.27 ¼ (last trade date today) and Jul Chi up 5 3/4 cents at 7.07 1/4. May KC wheat down 1/2 cent closing at 6.51 ¾ (last trade date today), while KC Jul closed flat at 6.57 3/4. Not shocking all things considered, but wheat had a very similar week to corn, losing 54 ½ cent this week for Chi July futures. If you’re a technical trader, the wheat chart is not good. To put in a double top and then trade every day since is a bearish signal. As rains are headed for key areas like Kansas and Oklahoma this weekend, northern Plains will still stay dangerously drought-ridden with no rain in sight. With that, spring wheat planting should’ve continued to progress this week; we’ll see how the number improves from the 70% we saw this week. With a bearish USDA report, record production numbers, export demand being very weak, and plentiful rains headed for much of wheat country this weekend, there are a lot of bearish fundamentals pushing on this week market.

CATTLE HIGHLIGHTS: Live cattle futures softened again today, closing 30 to 80 cents weaker with October leading today’s drop, closing at 123.25. A lack of fresh new news and follow through from yesterday’s price plunge weighed on futures today. It does not appear there is much friendly news for the cattle market from the perspective that supplies are backed up. Cutout values continue to hold well, and packers are working deep in the black. Still, the concern is backed up inventory. Feeder cattle prices gained ground today on another sharp selloff in the corn market. Though corn prices are high, futures posted very significant losses this week in the range of 80 to 90 cents. This should be supportive to feeder cattle as will expectations for better chances of moisture throughout parts of cattle grazing territories. Yet, bigger drought concerns continue, and with high priced corn, even after this week. We have to expect that cow calf operators are likely to begin liquidating less than perfect animals. Estimated slaughter today is 115,000 head with choice cuts traded down 64 cents at 316.14 and select at 292.74 down 2.97.

LEAN HOG HIGHLIGHTS: Hog futures finished lower again today as most futures lost near $1.00. The larger uptrend remains intact, but a slide through the 10-day moving average early in the week and a test of the 21-day moving average today has traders cautious. It could be the market is concerned with general news from China that it wants to battle high commodity prices. In addition, other commodities such as iron took a big plunge this week, suggesting China may be challenged with high priced commodities and is willing to hold off on new purchases. Whatever the case, the charts remain supportive, but the market could be losing momentum. Last week technical indicators stochastics had a crossover point suggesting overbought and a cell signal. Today’s estimated slaughter is 461,000, in line with a week ago yet well ahead of last year’s 382,000. Keep in mind last year was affected by covid. A significant drop in corn prices this week could be suggesting that unless weather is a problem with this year’s crop, the high could be in place.

Top Farmer Midday Update 5-14-21

Grain - beautiful landscape of sunset over corn field

CORN

  • July Corn down 16 @ 6.58  Dec down 3 @ 5.54
  • Funds lifted 65,000 contracts of corn yesterday
  • Still too hot & dry in Brazil – could see much higher demand than USDA projects
  • Coast guard reopens Mississippi River to barge traffic
  • Private export sales of 1.360M mt – delivery China
  • O/I: Lost 11,596 positions in July futures

SOYBEANS

  • July up 9 @ 15.93 & Nov up 11 @ 14.07
  • Soybeans & meal recovering today from yesterday’s price slaughter
  • Soybean stocks still extremely tight – likely tighter than current 120 mb ending stock
  • Rumor is Brazilian beans are headed to US as crushers need supplies
  • Northern plains still remain drought ridden and spreading
  • O/I: Lost 12,751 positions in July futures

WHEAT

  • July wheat up 10 @ 7.11, July KC up 5 @ 6.62, July MNPLS up 8 @ 7.48
  • All wheat futures up today after yesterdays grave fall
  • Heavy rains still projected for much of central plains
  • Northern plains are still dry making the drought worse
  • Russian Ag Econ group pegs Russian crop at 81.7 less than USDA
  • French wheat still rated 79% good/excellent
  • O/I: Lost 4,242 positions in July wheat & lost 3,985 positions in KC July wheat

CATTLE

  • June LC up .42 @ 116.02 & August FC up .02 @ 150.52
  • June cattle have substantial discount to cash
  • Knee-jerk reaction of trade based on rumor of beef plant not running may be done
  • Bids at 119 – Asks around 120 – still quiet trade
  • Feeder Cattle cash index for May 12; up .44 @ 131.01
  • Cattle slaughter projected at 116K
  • Open interest lost 6,925 for June futures & lost 500 for Aug FC

HOGS

  • June hogs down .10 @ 110.00 & June Pork Cutout down .07 @ 115.60
  • June & August have back filled previous gaps left on charts
  • Pork cutouts significantly higher yesterday offsetting lower cash
  • Hog slaughter projected at 478K
  • Cash lean index for May 11; up .22 @ 110.95
  • O/I: Lost 6,075 for June hogs & June pork cutout lost 27 positions

Top Farmer Closing Commentary 5-13-21

Grain - Corn Field Blue Sky

CORN HIGHLIGHTS: Corn futures plummeted today closing lower for the second consecutive session losing 40 cents in July (limit lower) to 34-3/4 cents weaker in December. July closed at 674-3/4 and December at 5.58-1/4. Sharp losses in soybeans and what along with a mostly conducive forecast for emergence and early season growth weighed on futures today. Perhaps the biggest factor over the last two sessions was a lack of bullish news from yesterday’s monthly WASDE report which was termed mostly neutral for the 2020-2021 crop and slightly negative for next year as carry out was about 150 mb more than the pre-report estimate. Was today merely a technical washout? Prices wasted little time trading to limit lower only to bounce and then at the close weaken again. This activity would suggest liquidation of longs. Managed money has been hoovering near the 350,000 to 400,000 net long. This is historically very high so liquidation is probably most of today’s trade action. We did hear some reports of basis weakening today. We don’t know if that was in reaction to weaker futures and if there is more to it. One thought is that the recent surge in price has farmers more aggressively selling. Negative export sales of 4.5 million was negative to the market while new crop sales at 82 million was supportive. Corn sales are at 96.1% of expected sales for the year.

SOYBEAN HIGHLIGHTS: Soybean futures closed sharply lower with losses of 45 to 58-1/2 cents either following or leading corn and wheat prices lower which also experienced sharp declines. Export sales at 3.5 million old crop and 3.8 million bushels for 21/22 was noted on this morning USDA export sales report. Both numbers were considered neutral. Soybean sales for old crop are 98.9% of expected year sales. After reaching new contract highs and their highest level since 2013, it didn’t appear there was any one reason for prices to drop. Therefore, the higher prices go, the faster the drop and today’s activity was an example where a market can lose value, quickly. The bearish argument for prices is they have over-heated in recent sessions. This does make sense as yesterday’s USDA report offered little new bullish fodder. Yes, stocks are critically tight and there is no room for error on this year’s crop, yet that along may not be enough reason for end user or speculator to continually buy into new contract highs.

WHEAT HIGHLIGHTS: May Chi wheat down 28 1/4 cents at 7.59 3/4 and Jul Chi down 28 1/4 cents at 7.01 1/2. May KC wheat down 30 1/2 cents closing at 6.52 1/4, while KC Jul closed down 33 cents at 6.57 3/4. If you’re a technical trader, wheat looks like a selling opportunity. Dropping after putting a double-top formation, from a chart perspective, is very bearish.  It’s hard to know if wheat pulled corn today or corn pulled wheat – either way it was a harsh day in both markets.  Heavy rains in southwestern plains are helping ease concerns in those areas.  However the true drought in the Dakotas and northern plains as a whole is not easing up anytime soon, and appears to only be spreading according to drought monitors.  Crop conditions remains favorable for major growing areas around the globe.  With yesterday’s bearish USDA report for corn and slightly bearish for wheat, it just set the stage for a sell-off in a top heavy market.  As we’ve said for weeks, wheat does not have the legs under it that corn and soybeans have – so if corn sells off, it will be hard for wheat not to follow.

CATTLE HIGHLIGHTS: Live cattle futures finished sharply lower on Thursday, as the commodity complex was hit with a round of risk off trade, pressuring the majority of ag commodities.  Front-end cattle futures traded at limit down for a portion of the session, before at lest lifting off those lows.  Regardless, the complex still had strong triple-digit losses.  June cattle finished 3.000 lower to 115.600, and August cattle lost 2.950 to 119.400. The difficult close did damage on the charts technically, and Friday’s price action will be key going into the weekend.  Light cash trade was being reported on Thursday afternoon, with Nebraska posting some $120 trade and Kansas at $119, while the rest of the country remains quiet.  More cash trade will likely develop late Thursday into Friday.  Wholesale carcass values were mixed at midday with Choice carcasses gaining 2.00 to 317.08, but Select was .71 softer to 296.45.  The Choice/Select spread continues to widen, possibly reflecting a more current feedlot.  Weekly export sales reported on Thursday morning failed to move the market.  New beef sales were at 13,100 mt, down 22% from last week, with Japan and China ats the top buyers on the week.  Weekly export shipments total 17,700MT, down 4% from last week.  Feeder cattle market faired a little better today, but still finished mostly lower.  May feeders were supported by the drop in grain prices on Thursday, gained .700 to 137.450, but August and deferred contracts were lower.  August feeders slipped .025 to 150.500. and September Feeders fell .075 to 151.975.  The weak live cattle complex and profit taking help pressure the feeder market.

LEAN HOG HIGHLIGHTS: Hog futures finished lower with triple-digit losses are the ag commodity market were caught in a risk off trading day, and sharp losses were seen throughout the markets.  June hog futures lost 1.925 to 110.100, and July hogs dropped 1.825 to 110.100.  June hogs did slid to fill the price gap from May 3rd, but the short-term trend is lower, fueled by profit taking and technical selling pressure.  The fundamentals supporting the market are still very strong.  Retail carcasses surged strongly higher at midday, gaining 6.34 to 120.45, just short of all-time highs set last year.  Movement was moderate at 139 midday loads. Weekly export sales were soft this past week, but China was on holiday for a large portion of the week.  New sales through May 6th total 14,700 mt with Mexico and China as the top buyers for the week.  Export shipments stayed supportive at 41,900 MT, up 13% from the prior week.  The overall strong demand tone helps support the cash market. The Lean hog index gained .22 to 110.95, setting the stage for a 15th consecutive week with a higher close.  Today’s selling pressure was more technical than based on fundamentals.  Some damage was done to the charts, so price action tomorrow will be key going into the weekend.  The top is still not likely in the hog market, based on the fundamentals, but the price action may be starting to show that it could be near.

Top Farmer Midday Update 5-13-21

Grain - beautiful landscape of sunset over corn field

CORN

  • July corn down 40 @ 6.74 & Dec down 40 @ 5.53
  • Weekly exports saw reductions of 113,400 mt
  • Yesterday’s reporting showing ending stocks higher than expected
  • Corn futures continue to plunge lower after USDA report
  • USDA lowered Brazil’s corn crop to 102 million mt
  • 91.1 million acres & yield of 179.5 – USDA projects crop at 14.990 bb
  • Last week’s ethanol production rose by 27,000 barrels
  • Brazil’s corn crop continue to wilt due to heat and no rain

SOYBEANS

  • July down 65 @ 15.76 & Nov down 77 @ 13.67
  • Weekly export sales of 94,300 mt
  • Yesterday’s report not bearish but soybeans following corn
  • This week high of 16.70 not holding
  • USDA raised new-crop carryout to tight 140 mb
  • 4.405 bb crop was estimated for 2021 growing season
  • Biofuel and food usage ramps up even more keeping demand in place

WHEAT

  • July wheat down 37 @ 6.92, July KC down 38 @ 6.52, July MNPLS down 36 @ 7.28
  • Weekly export sales of 30,300 mt
  • Corn toppling pulling wheat along side for the morning
  • Winter wheat production was 10% than a year ago at 1.283 bb per USDA
  • New crop ending stocks at 774 mb – about 12 mb higher than trade guess
  • World wheat production 789 mmt however demand almost equal to

CATTLE

  • June LC down 3.90 @ 114.70 & August FC down 1.72 @ 148.77
  • Weekly export sales of 13,100 mt
  • Cattle down when corn down limit concerning
  • Bids at 119 however today’s move will not help support those bids
  • Feeder Cattle cash index for May 11; up .12 @ 130.57
  • Cattle slaughter projected at 119K

HOGS

  • June hogs down 2.22 @ 109.82 & June Pork Cutout down 2.07 @ 115.70
  • Weekly export sales of 14,700
  • Packers aggressively looking for hogs
  • Hog slaughter projected at 483K
  • Cash lean index for May 10; up .63 @ 110.73

Top Farmer Closing Commentary 05-12-2021

Grain - american corn farmland blue sky-

CORN HIGHLIGHTS: Corn futures finished with losses of 2 to 18-1/4 cents as new crop Dec led today’s drop closing at 5.93, its lowest close in six sessions. A conducive weather forecast for most of the Midwest including above normal precipitation weighed on new crop. Jul futures closed down 7-1/2 cents at 7.14-3/4. Today’s Supply and Demand report had something for both bulls and bears. Projected carry out came in at 1.257 bb, in line with expectations of 1.260. Last month was 1.352 bb. Ending stocks for the year ahead were larger than anticipated at 1.057 bb as compared to the pre-report estimate of 1.354. World projected carry out was larger than expected as well for the 2020/2021 crop year at 284 mmt, above the pre-report estimate of 279.4. For the year ahead, projected world carryout at 292 mmt was also larger than the pre-report estimate of 284.1 mmt. Bull spreading was a feature again in today’s market. Emphasis on limited supply of old crop and expectations that production will now be 14.990 billion bushels allowed for the spread differential between old and new crop to widen. July futures closed above Dec by 1.23-1/2, a new contract high close. The total Brazil crop is estimated at 102 mmt slightly below the average pre-report estimate of 103.4 mmt and below the April figure of 109 mmt.

SOYBEAN HIGHLIGHTS: Soybean futures soared again today as bull spreading on limited supply propelled prices higher. Jul futures led the rally gaining 27-3/4 cents closing at 16.42-1.2 but not before another contract at 16.67-1/2. New crop Nov gained 12-1/4 cents closing the session at 14.43-3.4. Today’s supply and demand report estimated old crop carry out at 119 mb, in line with the pre-report estimate of 118 mb. The April estimate was 120 mb. The projected world carryout was neutral at 87 million metric tons. Both the Brazil and Argentina estimates were left mostly unchanged. The strength in the soybean market is coming from continued strong demand. In addition, the longer-term picture looks supportive. The breakdown of today’s report for the year ahead indicates expected higher domestic usage, in part due to biodiesel. The charts, especially in old crop, represent a near run-away bull market. The next round figure objective is $17.00. The bottom line seems to remain the same and that is it does not appear U.S. farmers are holding much if any soybeans And, what beans are out there are probably in strong hands. The USDA is not likely to suggest carrying out under the current figure though many believe the actual amount of beans on hand is even tighter. Projected carryout for next year is 140 mb. This was slightly above the pre-report estimate of 132 mb. No matter, there is no room for error when producing crops in either hemisphere in the year ahead.

WHEAT HIGHLIGHTS: May Chi wheat down 5 cents at 7.54-3/4 and Jul Chi down 12 cents at 7.29-3/4. May KC wheat down 19-3/4 cents closing at 6.82-3/4, while KC Jul closed down 19-3/4 at 6.90-3/4. Heavy rains across the Southwest and southern Plains for this weekend added some selling pressure to wheat. This is expected to be short-term as the driving force of weather concerns is the northern Plains which are still dry with no rain in sight. The USDA’s new estimates for wheat today were extremely vanilla – higher production estimates than expected for winter wheat. The USDA said U.S. ending stocks would fall from 872 mb to 774 mb. All wheat production at 1.872 bb and dropped the export estimate to 900 mb. Current wheat export was reduced from 985 mb to 965 mb which the U.S. will still struggle to meet. Once again, a record crop of 788.98 mmt was projected but a projection of 788.68 mmt in world demand was also projected – quickly making the estimate a lot less bearish. Global ending stocks were virtually unchanged at 294.96 mmt versus last year’s 294.67 mmt. Again, wheat doesn’t have the kind of bullish argument behind it like corn and soybeans do, and today didn’t change that.

CATTLE HIGHLIGHTS: Live cattle futures finished mixed on Tuesday, as prices consolidated at the top of yesterday’s gains. Jun cattle slipped 0.025 to 118.600, but Aug cattle gained 0.275 to 122.325. The lack of cash market direction weighed on live cattle prices, despite strong retail markets and gains in the feeder cattle markets. Some light cash trade was developing today in Nebraska and Texas with trade from $119-120, and some dress trade in the North at $191, steady to slightly higher than last week. Still a small amount and not enough to establish a trend, but still disappointing, holding the market in check. Wholesale carcass values remain strong, with gains at midday. Choice carcasses gained 2.34 to 314.71, and select was 1.39 higher to 297.73. Movement was moderate at 67 midday loads. The strong retail values bolster packer margins, but with slaughter capacity limited, and plenty of cattle available, the cash market will struggle to get its footing. Feeder cattle saw strong gains on Tuesday as May feeders gained 1.425 to 136.750, and Aug feeders were 1.675 higher to 150.525. The USDA grain supply/demand report put pressure on corn and wheat prices, supporting the feeder market. Prices have rallied nicely off recent lows in the feeder complex, but if the corn market begins to climb again, prices could see new selling pressure.

LEAN HOG HIGHLIGHTS: Hog futures finished mixed as strength and bull spreading lifted the front-month contracts. May hogs gained 0.325 to 111.800, and Jun gained 0.850 to 112.025. Hog prices consolidated around yesterday’s trading range and were looking for overall direction. Weekly export sales are reported tomorrow morning, and that will give the hog market some direction into the end of the week. The retail market was strong at midday, gaining 4.90 to 118.10, within $3.00 of last year’s COVID-issues pork carcass highs. Movement was moderate at 168 midday loads. The strong carcass value stays supportive of the cash market. The Lean Hog Index gained 0.63 to 110.73 and trading at 8-year highs. The strong demand keeps the packers active looking for slaughter hogs, overall supporting the cash market. Estimated slaughter today was 480,000, down 5,000 from last week. The largest headwind over the hog market has been the softening Chinese pork prices, now trading back to January lows. This factor will be closely watched for a longer-term trend. Currently, Chinese demand has stayed active and strong for U.S. pork and weekly export sales should continue to show that strength. Overall, prices are in an uptrend and consolidating. The fundamentals are still supportive, and the hog market is looking to work higher.

Top Farmer Midday Update 05-12-2021

Grain - american corn farmland blue sky-

CORN

  • Jul Corn down 6 @ 7.17 & Dec corn down 9 @ 6.01
  • US ending stocks for 2020-21 – 1,257 mil bu
  • US ending stocks for 2021-22 – 1,507 mil bu
  • US production for 2021-22 14,990 mil bu
  • World ending stocks 284 million mt for 2020-21
  • World ending stocks 292 million mt for 2021-22
  • Argentina production unchanged & Brazil to 102 million mt (109 in April)
  • Daily export sale reports of 100,000 mt of corn to Mexico
  • Ethanol production for last wk averaged 979K barrels per day – 2.84% from last week

SOYBEANS

  • Jul up 31 @ 16.46 & Nov up 15 @ 14.45
  • US ending stocks for 2020-21 – 119 mil bu
  • US ending stocks for 2021-22 – 140 mil bu
  • US production for 2021-22 4,405 mil bu
  • World ending stocks 87 million mt for 2020-21
  • World ending stocks 91 million mt for 2021-22
  • Argentina production 47 million mt (47.5 in April) mt & Brazil unchanged
  • Veg oil prices continue to surge adding support to futures
  • Prices at levels not seen since 2012’s drought

WHEAT

  • Jul wheat down 8 @ 7.33, Jul KC down 12 @ 6.97, Jul MNPLS down 4 @ 7.65
  • US ending stocks for 2020-21 – 872 mil bu
  • US ending stocks for 2021-22 – 774 mil bu
  • US production for 2021-22 1,872 mil bu
  • World ending stocks 295 million mt for 2020-21
  • Paris milling futures down but still close to their highs
  • Worsening drought conditions in Plains continue to be point of focus & concern in futures

CATTLE

  • Jun LC up 0.50 @ 119.12 & Aug FC up 1.30 @ 150.15
  • Cattle continues to climb higher in spite of grain prices
  • Strong demand needs to be met – packers may finally bid higher
  • No cash bids/offers yet – packers don’t want to bid higher
  • Cattle slaughter projected at 118K
  • Open interest lost 8,133 for Jun futures & gained 28 for Aug FC

HOGS

  • Jun hogs up 0.85 @ 112.00 & Jun Pork Cutout up 0.55 @ 117.47
  • No indication demand has slowed or hogs have become more abundant
  • Buyers appear to be buying recent break – fundamentals still bullish
  • Hog slaughter projected at 484K
  • Cash lean index for May 7; up 0.88 @ 110.10
  • O/I: Lost 8,103 for Jun hogs & Jun pork cutout lost 57 positions

Top Farmer Closing Commentary 05-11-2021

Grain - american corn farmland blue sky-

CORN HIGHLIGHTS: Corn futures shot higher after the pause session and never looked back. Overnight futures were weaker following sharp losses yesterday. However, continued concern over Brazil supplies and China a noted buyer again for the new crop, help to move price in a positive direction as did a weaker U.S. dollar and firmer soybean and wheat market. May futures, which has its last trading day on Friday, ended 11-1/4 cents higher at 7.59-1/2. Jul closed at 10-1/2 higher at 7.22-1/4 and new crop Dec closed 2 higher at 6.11-1/4. Tomorrow at 11:00 am central time the USDA will release its monthly Supply and Demand report. Attention will be focused on exports and production in Brazil. The pre-report projected carry-out figure for the U.S. is 1.260 billion bushels. This is a decline from the April estimate of 1.352 billion. Continued strong basis levels suggest tight inventory and strong demand. Planting at 67% complete as of Sunday is well ahead of the five-year average which is 52%. Poor pasture conditions, according to the most recent USDA Progress report, could imply more corn usage. Jul corn future price in China is at a 16-week high at $11.20 per bushel.

SOYBEAN HIGHLIGHTS: Soybean old crop futures rallied into new contract highs today with Jul futures leading today’s charge closing 27-1/4 cents higher at 16.14-3/4, while new crop Nov gained 17-1/4 closing at 14.31-1/2, a new contract high close. Strong gains in soymeal of near 5 per ton and soybean oil gaining near 100 points on futures all provided underlying support. Tomorrow the USDA will release its monthly Supply and Demand report with projected carryout forecasted at 118 mb. Last month was 120 mb. There appears to be a growing belief that the USDA will make little change to carry out but that the true figure is somewhere well beneath 100 million. Projected world carryout is expected to remain unchanged at 86.9 million metric tons. The latest USDA crop report indicates that 42% of intended soybean acres are planted versus the 5-year average of 22%. The market is at a critical crossroads. What will be interesting tomorrow is to see whether higher prices are curbing demand. The cash market would suggest not. For four months the projected carryout did not change, yet both cash and futures prices continued to move higher. Potentially, the most interesting figure to be watched tomorrow will be 2021/2022 projected carry out. The current preview report estimate is 132 million. The bottom line there is no room for error producing the crop ahead.

WHEAT HIGHLIGHTS: May Chi wheat up 17-1/4 cents at 7.59-3/4 and Jul Chi up 11-1/4 cents at 7.41-3/4. May KC wheat up 7 cents closing at 7.02-1/2, while KC Jul closed up 7 cents at 7.10-1/2. No real change in fundamentals today, so wheat seemingly followed fellow grain corn today. Expanding drying in the northern Plains continues to be a driving force in wheat support. USDA crop progress showed 70% of spring wheat crop is planted – ahead of the 5-year average of 51%. North Dakota’s topsoil moisture shows that 80% is less than adequate as drought continues to expand. Winter wheat crop improved by 1% this week to 49% good/excellent but that’s still slightly behind last year’s 53% at this time. Kansas, however, dropped 2% from last week’s rating to 53% good/excellent. All eyes will be on tomorrow’s UDSA wheat report – its expectations are for new-crop ending stocks to fall to 762 mb, the lowest in 7 years. However, if exports don’t start to increase, that number just becomes less impactful – as of right now the U.S. looks like we won’t meet May’s expectations without some major export business through the rest of May.

CATTLE HIGHLIGHTS: The cattle market saw another day of good buying strength, led by the live cattle futures. Additional short-covering and technical buying supported by the retail beef market supported the live cattle futures on Tuesday.  June cattle still limited by cash trade gained .400 to 118.625, but August cattle gained 1.700 to 122.050.  The strength stayed throughout the market with the Dec and later contracts pushing to new contact high closes on today’s session. The wholesale beef market is the driving force under the cattle market’s recovery from the recent selloff. Choice carcasses gained 2.84 to 311.95, and select carcasses were 2.59 higher to 296.35. The choice-select spread has been starting to move wider as carcass weights have trended lower, possibly reflecting a more current feedlot situation and cattle being pulled forward in the face of high grain prices. A more current countryside may start shifting the leverage to the producer from the packer, but that will take time. Current packer margins are estimated at over $700, as slaughter cattle are very available and the packer isn’t pressured into a stronger cash market for those animals. Cash trade is still unestablished, and that is weighing on the Jun futures. Expectations are for steady to slightly higher than last week, but the majority of business will hold off until tomorrow or later. The strong close on the Aug and Oct contracts have those markets looking to retest the contract highs that Dec and later futures pushed through today. The live cattle technical picture is vastly improved over the past couple of days. Feeder cattle manage to hold small gains, with the exception of May feeders. The May contract dropped 0.125 to 135.325, but Aug feeders gained 0.150 to 148.850. A return of strength in the grain markets limited the gains in the feeder complex, despite the strong live cattle move. The price relationship between feeder cattle and live cattle has needed adjusting, and that process may be at hand.

LEAN HOG HIGHLIGHTS: Hog futures saw moderate selling pressure again on Tuesday, as prices continue to consolidate off the most recent move higher. Jun hogs finished 0.925 lower to 111.175, and Jul hogs lost 1.275 to 111.425. Technically, front-month charts failed to push over key price levels at the 10-day moving average, leaving the door open for further downside pressure. The price gap on the Jun charts at 109.725 and the 20-day moving average are possible near-term downside targets. A factor weighing in hog futures has been the weakness in Chinese hog values. Live hog futures on the Dalian Exchange in China have lost 7% over the past 2 days, to the lowest level since end-January.  This may be due to the restriction of animal transport in China to help curb ASF, causing production build-up in regions, pressuring prices. Secondly, since live cattle and hog touched equal value, spreading between cattle and hogs has become evident. Fundamentally, the market is still strong. Cash trade stays firm and the Lean Hog Index gained 0.88 to 110.10, running a slight discount to May futures. Carcass values stay firm overall and were firmer at midday. Pork carcasses traded 0.55 higher to 113.71 on moderate movement of 199 loads. Recently beef and chicken wholesale prices have accelerated higher, leaving pork behind. Could a sharer upside move in carcass values be on the horizon? Demand is strong and export demand may be the driver behind a possible move higher in products. The current price action in the hog market is more consolidative in nature, back-checking support levels. The fundamentals are still strong, and hogs have the potential for another push higher. At this point, the top doesn’t look to be in at this point.

Top Farmer Midday Update 05-11-2021

Grain - american corn farmland blue sky-

CORN

  • Jul Corn up 18 @ 7.29 & Dec corn up 6 @ 6.16
  • Corn planting progress 67% in US – average 52%
  • Crop emergence 20% – cool weather delayed in some areas
  • In the past 2 days, China bought 93.7 mb (canceled 13.4)
  • US basis still extremely tight and on the rise
  • Brazil crop areas have continued to wilt with lack of rain/high temps
  • O/I: Lost 6,381 positions in Jul futures

SOYBEANS

  • Jul up 32 @ 16.19 & Nov up 16 @ 14.31
  • World veg oils made a correction and lending support
  • US planting 42% complete – fastest start in 12 years
  • Emergence is 10% ahead of 4% average
  • Drought continues to compromise northern Plains
  • O/I: Lost 5,612 positions in July futures

WHEAT

  • Jul wheat up 13 @ 7.43, Jul KC up 12 @ 7.15, Jul MNPLS up 16 @ 7.69
  • Not enough rains in Montana & Dakotas to counter drought
  • Unlikely – but wheat needs to pick up in exports to meet USDA projections
  • Spring wheat planting now 70% and 29% emerged
  • North Dakota topsoil moisture at 80% less than adequate
  • Winter wheat rating at 49% – 1% up from last week
  • O/I: Lost 3,472 positions in Jul wheat & gained 80 positions in KC Jul wheat

CATTLE

  • Jun LC down 0.22 @ 118.00 & Aug FC down 0.55 @ 148.15
  • Strength in boxed beef will require packers to satisfy demand
  • No cash bids/offers yet – packers don’t want to bid higher
  • Cattle slaughter projected at 1219K
  • Feeder Cattle Cash index for May 7; down 0.68 @ 130.15
  • Open interest lost 7,413 for Jun futures & gained 180 for Aug FC

HOGS

  • Jun hogs down 1.07 @ 111.02 & Jun Pork Cutout down 1.47 @ 116.57
  • No indication demand has slowed or hogs have become more abundant
  • Lower cash is of some concern – close to resistance?
  • Hog slaughter projected at 484K
  • Cash Lean Index for May 6; up 0.67 @ 109.22
  • O/I: Lost 7,977 for Jun hogs & Jun pork cutout lost 2 positions

Top Farmer Closing Commentary 05-10-2021

Grain - american corn farmland blue sky-

CORN HIGHLIGHTS: Corn futures ended with double-digit losses as prices reflected better than expected rainfall in South Dakota, Iowa and Illinois. Heavy technical selling was noted as well as funds were liquidating when stochastic signals crossed to a sell on the over-bought range. Jul corn lost 20-1/2 cents closing at 7.11-3/4 and Dec 27-14 ending the session at 6.09-1/4. Also pressuring prices was a selloff in the wheat market which lost between 30 and 40 cents as better weather and U.S. wheat considered overvalued as compared to the rest of the world. Export inspections at 67.2 mb were termed supportive bringing this year’s total to 1.778 bb. This implies that 66.5% of expected sales of 2.675 bb are now moved out of the country. In other news this week, expectations are for corn planting to be well north of 60% with a forecast of normal temperatures and above-normal precipitation for the entire Midwest. On Wednesday, the USDA will release the monthly Supply and Demand report. Expectations are for a small downgrade to Brazil’s corn crop and considering how hot and dry weather has been over the last two weeks do not expect a significant decline. That could take a month to show up. Dow Jones survey suggested corn carryout down from 1.352 bb to 1.265 bb.

SOYBEAN HIGHLIGHTS: Soybean futures finished near steady on the front months and with moderate to strong losses in new crop. Jul lost 2-1/4 cents closing at 15.87-1/2 and Nov down 19-1/4 at 14.14-1/4. Export inspections were termed neutral to friendly at 8.7 million bushels. This brings the year-to-date total to 2.047 billion bushels. This is 89.8% of the total forecasted sale figure of 2.280 billion bushels. This week’s USDA Supply and Demand report is expected to confirm tight ending stocks. Last month’s figure was 120 mb and some are believing that the true figure is closer to 100 mb. Jul soybeans are considered expensive in China with an equivalent U.S. price of 18.70 per bushels for Jul soybeans on the Dalian Exchange. Projected usage for soybean oil could be on the rise as there are many who believe additional diesel from soybean oil will be produced in the year ahead keeping demand for soybeans active. There’s little doubt that South America will increase production in 2021/2022, yet for now, that is a long way off and the market has to deal with U.S. weather as well as tight supply.

WHEAT HIGHLIGHTS: May Chi wheat down 32-1/4 cents at 7.42-1/2 and Jul Chi down 31-1/4 cents at 7.30-1/2. May KC wheat down 32-1/4 closing at 6.95-1/2, while KC Jul closed down 33-1/4 at 7.03-1/2. Today’s selling in all grain markets was sparked by scattered showers in southwestern Plains with more rain expected in the next two weeks.  Today’s crop rating report showed minimal improvement with 49% of the crop rated good/excellent – that’s up 1% from last week. All eyes will now shift to Wednesday’s USDA report and wheat production estimates. The USDA could once again raise the production numbers to an even higher record production number which may bring the trade back to trading that versus dry weather in the Plains. Spring wheat however is still very much at risk and that story has not left the market by any means – the Plains did get some rain over the weekend and today, but certainly not enough to mitigate the drought they are fighting currently. This Friday will be last trading day for May contracts.

CATTLE HIGHLIGHTS: The cattle market saw strong buying strength and short covering to start the week, as some live cattle futures and feeder cattle futures posted triple-digit gains. Jun live cattle gained 2.200 to 118.225, and the Aug contract added 1.500 to 120.350. The strength in live cattle was fueled by a strong move higher in feeder cattle markets as a sharp break in corn prices triggered strong buying in the feeder market. In addition, beef carcass values maintained an upward trajectory. Choice carcasses gained 1.64 to 307.52, and select was 3.28 higher to 293.55. A good start to the week after choice boxes gained $12.61 and select was $9.57 higher last week. Load count was light at 33 midday loads. The strong beef values should build some cash market optimism this week. After a steady to slightly higher trade last week, Monday stayed typically quiet with bids and asking prices undeveloped. Typically, trade volume will hold off until Wednesday or later. The strong move higher in the live cattle market quickly improved charts technically, but the key will be follow-through. Carcass weight slipped a couple of pounds last week to 828 pounds and with estimated slaughter running 11,000 head under the previous week, total beef production was 527.3 million pounds, down from 550 million pounds the week before. The tighter supply picture and strong demand should help support prices. Feeder cattle pushed strongly higher, as May feeders gained 3.725 to 135.450, and Aug feeders gained 4.425 to 148.700. The feeder market was oversold, and the strong break in grains fueled the upside rally. Like live cattle, follow-through support this week will be key in completing a turn higher, and that may be based on the actions of the grain markets.

LEAN HOG HIGHLIGHTS: Hog futures finished mixed with additional bear spreading seen in the market. May hogs lost 0.075 to 111.900, and the heavily traded Jun hogs were 0.750 lower to 112.100. The longer-term deferred contracts, Dec and later were slightly higher today. The Jun hogs saw additional selling pressure but were holding support above the May 3 price gap on the charts and the 10-day moving average. Trade today was more technically consolidative in action overall, as fundamentals stay supportive. The cash market and Lean Hog Index stay firm and are trending higher. The Cash Index was 0.67 to 109.22, start the path for a 15th consecutive week higher. The cash market doesn’t show signs of topping anytime soon as the pork carcass values stay strong. Midday carcasses gained 1.98 to 115.77 on light to moderate movement of 98 loads. This was a good start to the week after carcass prices trended high last week. The demand for pork products has stayed strong, and the recent sharp strength in beef and poultry prices has left pork behind, and the retail market may be ready for another strong move higher. This has kept the packers busy and active in securing cash hogs. Slaughter was down 46,000 week-over-week, and that should keep the cash market active. Estimated slaughter today was 483,000 head, up 5,000 from last Monday. The front-end of the hog market is consolidating and taking some profits, but the fundamentals and the longer-term trends in the hog market still look friendly as the market searches for a top.

Top Farmer Midday Update 05-10-2021

Grain - american corn farmland blue sky-

CORN

  • Jul Corn down 15 @ 7.16 & Dec corn down 23 @ 6.13
  • Weekly grain inspections 1.707M mt
  • Cancellations 280K tons of corn & 1,020M tons sold to China
  • Brazil expected to receive some short-relief from rains
  • Good rains in Corn Belt over weekend
  • O/I: Gained 8,176 positions in July futures

SOYBEANS

  • Jul down 3 @ 15.86 & Nov down 22 @ 14.11
  • Weekly grain inspections 125,111 mt
  • Palm oil down helping add pressure to futures
  • World demand remains stout
  • US domestic demand continues to remain very tight
  • O/I: Lost 8,127 positions in Jul futures

WHEAT

  • Jul wheat down 28 @ 7.33, Jul KC down 28 @ 7.08, Jul MNPLS up 4 @ 7.89
  • Weekly grain inspections 545,587 mt
  • Euornext Sep Wheat down at 244.50 as rain fuels selloff
  • Wet weather expected to return to western Russia this week
  • More rain received in Dakotas than expected – still nowhere close to enough
  • O/I: Gained 12 positions in Jul wheat & lost 2,048 positions in KC Jul wheat

CATTLE

  • Jun LC up 2.17 @ 118.20 & Aug FC up 3.57 @ 147.85
  • Packers may be willing to purchase cattle at a steady pace this week
  • Live cattle futures rise could help encourage cash prices
  • Cattle slaughter projected at 119K
  • Cash index for May 6; down 0.72 @ 130.83
  • Open interest lost 9,875 for June futures & gained 4 for Aug FC

HOGS

  • Jun hogs down 0.82 @ 112.02 & Jun Pork Cutout down 1.10 @ 117.90
  • Cash weakness expected to be short-lived
  • Packers should be aggressive early, looking for market-ready hogs
  • Hog slaughter projected at 481K
  • Cash Lean Index for May 5; up 0.66 @ 108.55
  • O/I: Lost 7,027 for June hogs & June pork cutout lost 37 positions

Top Farmer Closing Commentary 05-07-2021

Grain - american corn farmland blue sky-

CORN HIGHLIGHTS: Corn futures firmer for the eighth consecutive session with Jul closing 13-1/2 firmer at 7.32-1/4 and Dec gaining 11 finishing at 6.36-1/2. May futures closed 13-1/4 cents firmer at 7.72-3/4. The last trading day for May futures is next Friday, May 14. Jul futures gained 50 cents on the week and Dec 72-3/4. Another large export sale announced today with China the buyer for delivery into the new crop year helped give prices a boost as does continued concern that Brazil’s second crop Safrinha corn is on the decline. As we indicated yesterday, the market is moving quickly with upward momentum and after trying to turn into negative territory earlier today buyers took that as an opportunity to add or establish long new positions. Corn planting is going very well for most in the Midwest. The weekly drought monitor map released yesterday indicates encroaching dry conditions in the western Corn Belt. Expectations for rain over the next several days and cool temperatures are considered a negative to price but so far rainfall totals have been disappointing, not unusual in a dry weather pattern.

SOYBEAN HIGHLIGHTS: Soybean futures ended the day and week with strong gains as May gained 15-1/2 closing at 16.21. Next Friday, May 14, is the last trading day for the May contract. Jul soybeans gained 20-1/4 cents closing at 15.89-3/4 and Nov added 24-1/2 cents finishing the session at 14.33-1/2. For the week, Jul soybeans gained 55-1/2 cents and Nov added 93.3/4 cents. All contracts finished into new contract high territory. It was a different day but much the same story as each day this week. Stronger world vegetable oil prices, short covering, and a surge in corn prices favoring corn planting all suggest soybeans needed to move higher. We make the point again today that we did yesterday, and that is the market has finally moved to levels where it will likely ration inventory. Soybean harvest in Argentina is over 50% complete with some suggestion yield might be slightly better than anticipated. It is likely that with a surging price this week the crush pace may begin to slow reflecting higher prices, lack of supply or both. Soybean meal had a strong day gaining near 7.00 on most futures contracts closing at its highest price since early January but still has not moved above contract highs which are another 15 to 20 dollars higher.

WHEAT HIGHLIGHTS: May Chi wheat up 9-1/4 cents at 7.73-1/2 and Jul Chi up 8-1/2 cents at 7.61-3/4. May KC wheat up 10 cents closing at 7.27-3/4, while KC Jul closed up 10 cents at 7.36-3/4. Today all May contracts are off the board – with MNPLS wheat up 4-1/2 putting in a contract high before retiring as front-month futures for the day at 7.89.  Drought in the northern Plains continues to be a driving force for our wheat prices. The U.S. dollar fell sharply today after disappointing jobs report, adding strength to the wheat market – one would think it would make U.S. wheat look more attractive, however, we’ve yet to see that come to fruition. Eyes will be on next week’s export as this week not only did we not add to the tally sheet but subtracted from it with cancellations of 95,600 mt. French wheat conditions have declined for a 4th week in a row, however still at 79% good/excellent rating. Russia’s ag consults reduced their projection for Russian production to 79 mmt – down 500,000 from previous estimates.  Canada’s wheat stocks are the smallest they’ve been in over 5 years.

CATTLE HIGHLIGHTS: Live cattle futures finished the week with mixed trade, and slipping off session highs. Jun cattle gained 0.550 to 116.025, while Aug cattle gained 0.375 to 118.850. For the week, Jun cattle finished 0.500 lower but did finish well off early week lows, and Aug cattle gained 0.225. Choppy trade was noticeable on Friday, and the market looked to be squaring up positions going into the weekend. The strength in the grain markets later in the session added to selling pressure, and both live and feeder cattle futures slipped off early-session highs. Cash trade in the countryside was quiet this afternoon with business essentially done for the week, although we may see just a little cleanup trade reported. Southern live deals this week have had a full range of $117.50 to $119, while Northern dressed business has had a range of $187 to $192. The trend was mostly steady to slightly higher than last week, which may have helped pull live cattle prices off the lows for the week. Carcass values trended higher throughout the week but were mixed at midday today. Choice carcasses dropped 0.41 to 305.96, but select was 3.04 higher to 292.40. Load count was light at 47 midday loads. Beef prices are strong with good domestic and global demand. Overall supplies of pork and chicken remain historically tight, which has helped the beef carcass values. Packer margins are strong, but supplies of slaughter animals are readily available, which has kept the packer in control in the cash market. The live cattle market seemed to find some value buying this week, especially when Jun live cattle and Jun hogs traded at equal values. This has only happened two other times since the early 1980s. Feeder cattle started the day with strong short-covering, but corn prices found their footing in the later part of the session, and that pressured feeders. May feeders were 1,250 higher to 131.725, and Aug feeders gained 0.875 to 144.275. Both of these closes were well off the strong triple-digit gains seen at the early part of the day. The corn market will stay as a key component of feeder prices, and more strength in the gains keeps the sellers active. The week has improved overall for live cattle, but the market is still trying to establish a near-term low.

LEAN HOG HIGHLIGHTS: Hog futures finished mixed with some profit-taking seen on the front-month contracts. May hogs were 0.575 to 111.975, but Jun hogs dropped 1.625 to 112.850. For the week, the Jun contract was 3.125 higher, and Jul hogs gained 4.300. The cash market stays red hot and supporting the May futures. The cash hog index gained 1.66 on the week for its 14th consecutive higher weekly close. Today the index added 0.66 to 108.55. The countryside cash market has stayed very supportive, and packers are still bidding aggressively for market hogs. Pork carcass cutout values were strong at midday, gaining 3.336 to 117.22, being led by a strong move higher in the belly primal. Pork carcass values have trended higher this week as the demand for pork domestically and in the export market keeps the product moving. Estimated slaughter today was 462,000 head and for the week at 2,393,000 head, both totals running under last week, helping add to the strength in cash. The fundamentals have been supportive of hog prices, and this has kept the buyers active. Days that have given the market a pullback have turned into buying opportunities recently, as the top is still not developed in the hog market.

Top Farmer Midday Update 05-07-2021

Grain - american corn farmland blue sky-

CORN

  • July Corn up 7 @ 7.26 & Dec corn up 2 @ 6.27
  • Dec corn continues to rally to new contract highs
  • Forecast remains hot/dry for Brazil corn
  • Will USDA lower Brazil crop below 90 mmt from 109 mmt?
  • US – heavy rains for much of Corn Belt
  • Argentina corn harvest 23% complete – 5-year average 32%
  • O/I: Gained 2,228 positions in July futures

SOYBEANS

  • July up 12 @ 15.82 & Nov up 15 @ 14.24
  • Nov sets new contract high of 14.29
  • World veg oil markets continue to surge pushing futures higher
  • Stout demand & issues in EU rapeseed area add support
  • Cash soy bids above $16 as buyers desperate to find soybeans
  • Argentine harvest at 53% complete
  • O/I: Lost 1,446 positions in July futures

WHEAT

  • July wheat up 2 @ 7.56, July KC up 6 @ 7.24, July MNPLS up 5 @ 7.84
  • Paris milling wheat futures are up again for 4th day in a row
  • French soft wheat conditions still at 81% good/excellent
  • Drought in US Plains continues to be the big story in wheat
  • Russian wheat production forecast lower to 79 mmt
  • O/I: Gained 24 positions in July wheat & lost 577 positions in KC July wheat

CATTLE

  • June LC up 1.35 @ 116.82 & August FC up 2.85 @ 146.25
  • Packers need cattle may force them to increase bids next week
  • FC up today despite corn moving higher
  • Asking prices around $119
  • Cattle slaughter projected at 115K
  • Cash index for May 5; down 0.99 @ 131.56
  • Open interest lost 4,486 for June futures & lost 241 for Aug FC

HOGS

  • June hogs down 1.30 @ 113.17 & June Pork Cutout down 1.02 @ 119.00
  • End of the week profit-taking happening today
  • Tightening supplies will keep packers searching and bidding aggressively
  • Hog slaughter projected at 474K
  • Cash lean index for May 4; up 0.52 @ 107.89
  • O/I: Lost 3,778 for June hogs & June pork cutout lost 10 positions

Top Farmer Closing Commentary 5-6-21

Grain - A combine harvesting corn

CORN HIGHLIGHTS: Corn futures started firmer on the overnight with most contracts adding another 10 cents by the pause session. As the session resumed, traders were quick to build long positions on new crop with December leading today’s rally finishing 20-3/4 cents firmer at 6.25-1/2. Bear spreading was a noted feature again today as May gained 6-1/4 and July 10-1/4. New contract highs were posted on all months. New crop prices may be the recipient of new buying due to South American weather. Private downgrades to the Safrinha second crop suggest that production may be somewhere near 95 million metric tons, well below the current USDA estimate of 109 mmt. In bushel conversion this could be a reduction of well over 500 million. With export sales already at record high levels for delivery in the current crop here it is likely new export sale activity for after September 1 delivery is likely. This was echoed last week when China was a noted buyer for the new marketing year. The price spread between July and December futures closed today at 97.5 cents July over December. Two days ago, this spread was at 1.20. rain has kept some out of the field in the Midwest, but planting progress is still at a very rapid pace with many producers expecting to be done within days. Export sales at 5.4 million bushels were termed neutral too weak yet, year to date sales are now 2.671 billion bushels or 99.85% of the projected USDA estimate of 2.675 bb.

SOYBEAN HIGHLIGHTS: Soybean futures firmed during the overnight session with double digit gains and kept gaining after the resumption of trade at 8:30, eventually closing 27-1/4 higher in July at 15.69-1/2. November closed into another round of new contract highs, gaining 26-1/4 cents at 14.09. Nearby May gained 23-1/2, closing at 16.05-1/2. Sharp gains in palm oil, limited farmer selling, and short covering were noted features in today’s market. Despite export demand shifting to South America, the US is still selling soybeans. Today’s export sales report indicated 5.4 million bushels of old crop and 4.2 million bushels of new crop sales. For the old crop, the year-to-date total is 2.252 billion bushels or 98.77% of the projected yearly total of 2.28 bb. While technically considered overbought, the soybean market is reflective of momentum and perception rather than paying attention to technical indicators. Supply and demand factors, in particular weather concerns, tend to be viewed more importantly than chart signals. When a market is less volatile, chart indicators often help guide decisions. It appears the market is quickly becoming concerned with big picture supplies, backing our argument the market did not do a good job or rationing supply this winter when priced traded sideways for months.

WHEAT HIGHLIGHTS: May Chi wheat up 8 1/2 cents at 7.64 1/4 and Jul Chi up 8 3/4 cents at 7.53 1/4. May KC wheat up 8 cents closing at 7.17 3/4, while KC Jul closed up 9 3/4 cents at 7.26 3/4. Although it took wheat a bit to get going this morning, between another strong run in the corn market combined with weather concerns in US Plains, wheat posted another decent/strong close. Today’s weather map shows scattered showers in Midwest but mainly dry anywhere else you look. HRW wheat crop could really benefit from moderate rains, expected to land tomorrow and Saturday. Very little change, if any, was posted in this week’s drought monitor. Spring wheat areas are expected to stay dry over the next week, with a few areas in Montana being the exception. Demand concerns arise as it doesn’t look like wheat exports will reach USDA’s 985 mb goal by the end of this month. Exports reports actually reported cancellations this morning of 95,600 mt – some of these may have shifted to new crop sales but hard to tell right now. Global crop conditions remain favorable, in stark contrast to what we have going on here in the US.

CATTLE HIGHLIGHTS: Live cattle futures finished higher for the second consecutive day, as the market saw additional short covering and value buying, supporting prices. June cattle gained 115.475, and August cattle finished 0.750 higher to 118.475. June cattle may be trying to etch out a bottom, but deferred contracts are staying consolidative and sideways in their price action. While the price action the past two days has been friendlier in tone, the session tomorrow may be key in ending the week, leading into next week. June is showing the biggest value compared to the cash market. Cash trade was quiet today, and the bulk of price action may be done for the week. The majority of trade was in the $118-119 range, steady to $1 higher than last week, and at a premium to the June futures. Beef demand stays strong, as choice carcasses gained 2.48 to 307.26, and select was 3.95 higher to 290.13. Load count was light at 47 midday loads. USDA released weekly export sales on Thursday morning, and beef sales were 16,900 MT, down 28% from last week. Japan and Mexico were the top buyers of U.S. beef last week. Export shipments were steady at 18,500 MT. The demand tone looks to stay strong in the near-term, but the market may become concerned of reaching a springtime peak in boxed beef prices. Feeder cattle could not follow the live cattle market higher on Thursday. May feeders dropped 1.000 to 130.475, and August feeders were 1.825 lower to 143.400. Charts still look week in the feeder market, and corn had strong move higher again on Thursday, adding to the selling pressure. A lot of questions in the cattle market at this time, prices are a value, but the supply side of the market stays heavy, and able to meet the demand. The end of the week will be key and could possibly set the direction for next week in both markets.

LEAN HOG HIGHLIGHTS: Hog futures closed mostly higher on Thursday, with front months establishing new contract highs for the third consecutive day. May hogs finished 0.025 higher to 111.400, and June fought off early session lows to gain 0.050 to 114.475. The direct in the hog market is still working higher, and the fundamentals stay supportive. The cash market has helped fuel the futures market, and  The Lean Hog Index gained 0.52 to 107.89, as the country side cash market still bids aggressively for hogs. Weekly export sales stayed supportive, as the USDA reported new sales last week of 48,200 MT, up 36% from last week. Mexico, China, and Japan were last week’s top buyers of U.S. pork. Exports were also strong at 37,100 mt, down from last week’s market year high, but still a supportive number. The pork carcass value pushed higher at midday, gaining 2.72 to 114.63 on moderate movement of 137 loads. Pork carcasses have been trending slightly higher this week, and the product movement has been moderate. Given the strong value of pork prices, the global demand for U.S. pork is staying very active, and that trend looks to continue. Technically, prices are in a strong uptrend, and there are no signs of a top. Like today, when prices pull back, this turns into an opportunity for buyers to step in.

TFM Midday Update 5-5-21

CORN

  1. July corn up 3 @ 6.99 & Dec corn up 11 @ 5.91
  2. Expanding drought in Brazil expected to remain next 10 days+
  3. Production estimates projecting Brazil corn 100mmt-90mmt
  4. US corn basis continues to firm as end users need grain
  5. Cash corn over 7.00 in many locations
  6. Heavy rains in S.E plains & Ohio valley – slowing field work
  7. O/I: Lost 9,220 positions in July futures

SOYBEANS

  1. July up 5 @ 15.44 & Nov up 13 @ 13.76
  2. Surging Veg oil values continue to support entire soy complex
  3. Demand continues to be strong from China
  4. Argentina rumor is that low river levels slowed exports increasing costs
  5. US soybean planting at 24% - near record high pace
  6. Old crop supplies still tight – demand rationing still needs to occur
  7. O/I: Lost 4,971 positions in July futures

WHEAT

  1. July wheat up 4 @ 7.30, July KC up 4 @ 6.86, July MNPLS up 5 @ 7.64
  2. Choppy trade day today but up for now
  3. Winter wheat conditions drop to 48% good/excellent
  4. Spring wheat planting rose to 49%
  5. Dakotas continues to struggle with extreme drought
  6. Some scattered rains expected in Eastern OK, KS, and CO
  7. O/I: Gained 89 positions in July wheat & gained 1,909 positions in KC July wheat

CATTLE

  1. June LC up .75 @ 114.30 & August FC up .60 @ 143.77
  2. Cattle weight declined – means cattle are being pulled forward
  3. Futures are oversold – today could be beginning of correction
  4. Light cash trade seen 118-119
  5. Cash index for May 3; up .13 @ 132.76
  6. Open interest lost 6,385 for June futures & gained 197 for Aug FC

HOGS

  1. June hogs up .75 @ 114.30 & June Pork Cutout up .60 @ 119.75
  2. New highs every day – strong demand and tight supplies
  3. Packers continues to be aggressive – where is consumer resistance?
  4. Cash lean index for May 3; up .27 @ 107.37
  5. O/I: Lost 2,702 for June hogs & June pork cutout lost 3 positions

Top Farmer Midday Update 5-4-21

CORN

  1. July corn up 20 @ 7.00 & Dec corn up 14 @ 5.77
  2. Brazil crop unchanged and under stress
  3. Crop estimates continue to drop for Brazil due to warm/dry weather
  4. US new crop taken on greater significance in world markets
  5. Planting now 46% complete in US
  6. Still no deliveries against May contract with cash bids well above delivery
  7. O/I: Lost 11,088 positions in July futures

SOYBEANS

  1. July up 14 @ 15.38 & Nov up 13 @ 13.58
  2. Soybeans fueled by soybean oil – challenging recent highs
  3. EU rapeseed prices are at a record levels
  4. Tight supply & big demand continues to support futures
  5. US soybean planting reported at 24% - fastest pace in 12 years
  6. Soybean crush for April at 188.2 mb – 192.mb a year ago
  7. O/I: Lost 3,461 positions in July futures

WHEAT

  1. July wheat up 4 @ 7.30, July KC up 4 @ 6.86, July MNPLS up 5 @ 7.64
  2. Choppy trade day today but up for now
  3. Winter wheat conditions drop to 48% good/excellent
  4. Spring wheat planting rose to 49%
  5. Dakotas continues to struggle with extreme drought
  6. Some scattered rains expected in Eastern OK, KS, and CO
  7. O/I: Gained 89 positions in July wheat & gained 1,909 positions in KC July wheat

CATTLE

  1. June LC down 2.20 @ 113.12 & August FC down 4.10 @ 142.70
  2. Feedlots are hoping for at lest steady prices this week
  3. Strong demand & higher boxed beef makes cash look too cheap
  4. Today’s slaughter est. at 119K head
  5. Lower cash expected this week, asks of 119
  6. Cash index for April for 30, down 1.50 @ 132.63
  7. Open interest lost 4,045 for June futures & gained 301 for Aug FC

HOGS

  1. June hogs up .15 @ 112.80 & June Pork Cutout up .45 @ 118.75
  2. Hogs refuse to topple with strong demand and tight supplies
  3. Consumers show no indications of price resistance yet
  4. Hog slaughter estimated at 484K head
  5. Cash lean index for April 29; stead, 106.89
  6. O/I: Lost 1,850 for June hogs & June pork cutout lost 1 positions

Top Farmer Closing Commentary 5-3-21

CORN HIGHLIGHTS: Corn futures exploded on the overnight session yet only managed to finish mixed. May futures breached 7.50 with a high of 7.58 before closing 7-3/4 cents lower at 7.32. July futures closed 6-1/4 higher at 6.79-1/2 and December down 0-3/4 at 5.63. It appeared buying interest dried up by midmorning as wheat prices came under selling pressure finishing with double digit losses. Bear spreading was a noted feature in soybeans and corn as old crop contracts lost large overnight premiums. Export inspections at 84.2 million were termed supportive. There has been much talk as of late that inspections will not be able to reach export sales. We are not sure we agree with that assessment. Today’s total inspection number places the year-to-date total at 1.708 bb and 63.9% of the total expected export sales. Inspections would need to average near 60 million bushels per week. This appears doable. Pressuring prices may have been expectations for strong planting progress over this past week as most of the Midwest was warm and dry. In addition, the six to 10 day forecast for the entire Midwest calls for above average precipitation and below normal temperatures. Therefore, the recent hot and dry experienced could be ending or at least taking a pause.

SOYBEAN HIGHLIGHTS: Soybean futures finish the session mixed after strong overnight gains. Like the corn market, the old crop contracts gave up significant premium as bear spreading was noted late in the session. May futures closed 10-3/4 cents lower at 15.60-1/4 after reaching an overnight high of 16.00. November gained 5 cents closing at 13.44-3/4. Export inspections, while positive were still termed disappointing at 5.3 million bushels. Total inspections are now 2.031 bb or 89.1% of the yearly expected sales of 2.280 bb. Expectations for strong planting progress may have also weighed on futures as did wheat prices, after trading sharply higher also finished with double digit losses. Since mid-April, May soybean futures have rallied 1.30. To give up 0.40 today from their highs is a disappointment for bullish traders yet one cannot argue with the overall trend that remains higher. It could very well be, however that prices may have found their peak. Keep in mind, that recent increases to margin requirements along with an increase of the daily trading range from 0.70 to 1.00 may have traders more reluctant to enter the market.

WHEAT HIGHLIGHTS: May Chi wheat down 17 cents at 7.25 1/2 and Jul Chi down 16 3/4 cents at 7.18. May KC wheat down 15 3/4 cents closing at 6.82 1/2, while KC Jul closed down 15 cents at 7.88 1/2. Wheat was similar to corn and soybeans and was up strong in the overnight trade however most of us never saw it trade in the green today. Eastern Colorado & Kansas are expected to get a chance rain/snow mix today and there is some forecast for minimal rain through the week.  There is a minimal chance that HRW wheat crops could see some rain this week but not enough to get your hopes up. Spring wheat areas, moderate rains are predicted for parts of Montana this week – however where moisture is desperately needed in the Dakotas there is no rain in the forecast.  EU crops need more moisture as well but crop conditions are still relatively good. Today was tough day technically speaking – to put in a new contract how and trade so hard off of it isn’t a good sign but this happened last week as well and wheat fought through it. Not much has changed from a fundamental stand point. US wheat remains in jeopardy due to drought – and that same drought poses a threat to the entire corn & soybean season ahead. Crop Progress report says winter wheat condition is 48% good/excellent – that’s 1 point less than last weeks and down 5 points in the last 2 weeks.

CATTLE HIGHLIGHTS: Cattle futures finished mixed to start the week as the selling pressure stayed in the front end of the cattle market. June cattle dropped 1.275 to 115.300, and August cattle were .275 lower to 118.350. The deferred contracts past August saw some mild buying strength in a bear spread market. Technically, the June contract is weak, closing the month of April with a negative reversal, and with cattle supplies being heavy, may have a difficult time getting a bid, despite the strong demand. Cattle trade finished lower last week, and no trade was developed today. Cash trade will likely hold off until Wednesday or later again this week, with expectations of steady to lower. Total cattle slaughter last week, including Saturday kills was 649,000 down slightly from last week’s strong totals. Carcass weights ticked up to 530 lbs, and weekly production was 550.2 million pounds, in-line with last week. Those numbers, even with the strong demand has the market feeling that the production is there to meet the demand. Beef retail carcasses are pricing in the spring holidays, Mother’s Day and Memorial Day, helping push retail carcass values higher. Choice carcasses gained an additional 1.91 to 298.41, and Select was .96 higher to 284.01. The load count at midday was light at 36 loads. The market is concerned that retail values may be looking to peak soon, as the market moves past the spring push. Regardless, packer margins are strong, and that could hopefully give a boost to cash trade, but the large supply limits that optimism. Feeder cattle were mixed as well to start the week as the May contract dropped .550 to 133.050 and August climb to finish slightly higher, gaining .050 to 146.800. A choppy grain market and strength in deferred live cattle helped support the feeder market. The cattle market is still extremely oversold, but needs a trigger to get money flowing into the market. Lean hogs stay strong, and with the lean hog to Live cattle ratio ending the day at 1.02:1, is reflecting the two different markets. Cattle is undervalued, but the supply numbers will keep the market upside limited.

LEAN HOG HIGHLIGHTS: Hog futures finished strongly higher , following through from Friday’s strong close. May hogs gained .575 to 110.700, but June hogs finished a strong 2.925 higher to and July gained 2.825 to 112.075, as those n month and the deferred contracts closed with new contract highs. Prices gapped open on the open and worked higher in a strong technical move, opening the door for further upside. The cash market remain strong helping support the futures market. The lean Hog Index traded unchanged to at 106.89, shaking off two days of weakness. The index has traded higher for 13-consecutive weeks, and looks to hold that trend. The demand market for pork stays very supportive. China’s on-going battle with ASF has kept the demand optimism well into the second half of 2021, and the strong product movement has bolstered pork product prices. Midday pork carcass value gained 1.83 to 112.29, as all 6 pork cuts traded higher again today. Movement was moderate at 146 loads. Total hogs slaughter last week, with Saturday kill was estimated at 2,454,000 head, down 19,000 head from last week. The lower slaughter totals should help support cash market bids to start the week. The hog market remain strong, closing to new high. The monthly technical chart looks very strong with last week’s close, and the fundamental support as well as the hog market is still looking for a high.

Top Farmer Midday Update 5-3-21

CORN

  1. July corn up 5 @ 6.78 & Dec corn down 2 @ 5.61
  2. Ethanol margins continue to battle between corn values
  3. Rains moving through short-term slow planting progress
  4. Export inspections strong at 2.139M mt
  5. Corn basis holding firm in US
  6. July corn puts in contract highs today @ 6.98
  7. O/I: Gained 1,163 positions in July futures

SOYBEANS

  1. July down 11 @ 15.22 & Nov down 5 @ 12.13
  2. Meal & oil putting pressure on soybean futures today
  3. US planting progress projected to be 1/3 done
  4. Export inspections weak at 143,418 mt
  5. S. America continues to see shipping progress
  6. O/I: Gained 2,038 positions in July futures

WHEAT

  1. July wheat down 6 @ 7.23, July KC down 6 @ 6.97, July MNPLS flat @ 7.63
  2. Spring wheat still too dry no improvement in sight
  3. US dollar down today currently 90.95
  4. Spring wheat planting is well ahead of normal pace
  5. Weekly export inspections improved to 509,932 mt
  6. Seasonal weather in plains should boost growth
  7. O/I: Gained 1476 positions in July wheat & gained 58 positions in KC July wheat

CATTLE

  1. June LC down .45 @ 116.12 & August FC up .22 @ 146.97
  2. Futures have established a sideways trend for now
  3. Boxed beef strong futures remain support in spite of cash values
  4. Today’s slaughter est. at 115K head
  5. Light cash trade seen 118-119
  6. Cash index for April for 29; down .94 @ 134.13
  7. Open interest lost 2,938 for June futures & gained 208 for Aug FC

HOGS

  1. June hogs up 1.92 @ 111.65 & June Pork Cutout up 2.20 @ 117.45
  2. Packers remain aggressive due to higher cutouts & strong demand
  3. Hogs putting in new contract highs today
  4. Hog slaughter estimated at 478K head
  5. Cash lean index for April 28; down .12 @ 106.89
  6. O/I: Lost 862 for June hogs & June pork cutout gained 10 positions

Top Farmer Closing Commentary 4-30-21

CORN HIGHLIGHTS: Corn futures exploded late in session as May raced higher reaching a daily high of 7.46-1/4 before closed at 7.40. Since it is first notice day there is no limit on May corn futures. July corn futures closed limit higher, gaining 25 cents and finishing at 6.73-1/4. New crop December gained 17-1/2 cents finishing the session at 5.63-3/4. December was more of a follower as tight supplies of old crop and a mostly warm and dry forecast for Brazil for the first two weeks of May had old crop prices on the offensive. There were no corn deliveries posted against the May contract. End users are aggressively seeking inventory and are caught in a position to push cash higher to secure inventory. Planting progress is rapid and will offer resistance new-crop prices. Limits expand next week with corn futures able to trade as much as forty cents in one direction, an increase from 25 cents. As for Brazil total production was earlier estimated at 109 mmt and now private sources are suggesting under 100 mmt. In a year of tight supply there is little room for error. The market is quickly reaching levels to ration supply.

SOYBEAN HIGHLIGHTS: Soybean futures have been extremely volatile this week, and today was no exception. After trading with double digit losses during the morning, prices turned around and shot higher, closing 32 cents higher in July which closed at 15.34-1/4. New cop November gained 21, finishing the session at 13.39-3/4. A sharp rally in the corn market and a fantastic session for soybean oil helped to accelerate futures upward. After three consecutive days of losses, futures ended the week on a firm note. Recent weakness has been tied to improving weather in Argentina this week and concerns that China may have cancelled some other purchases from South America. Yet, strong demand and tight world supplies, in particular vegetable oils, are the cornerstones of this season’s bull market rally.

WHEAT HIGHLIGHTS: May Chi wheat up 5 cents at 7.42 1/2 and Jul Chi up 5 3/4 cents at 7.34 3/4. May KC wheat up 9 3/4 cents closing at 6.98 1/4, while KC Jul closed up 9 cents at 7.03 1/2. A choppy day in the markets today, wheat was down earlier at midday but turned around, partially fueled by corn prices moving higher yet again. Minneapolis wheat continues to soar, putting in another contract high today, based on worsening drought in Plains/Dakotas specifically. HRW areas are also too dry, and currently there is just little to no rain in the forecast for relief. Eastern Colorado and Kansas may see some relief next week but will need more moving forward. Soft red winter growing areas should receive adequate rains next week. Ukraine was reported to have a better wheat crop on the way – current Ukraine ag pegs their crop at 27.7 mmt. Ukraine and Southern Russia are still in good shape regarding crop conditions; however, recent cold spurs in the EU put their crop in jeopardy. Monday will be key to traders to see if US good/excellent crop conditions further decline beyond this week’s 4% drop to 49%.

CATTLE HIGHLIGHTS: Cattle futures finished mostly higher to end the week, as the June contract gained 0.525 to 116.575, and August Cattle were 1.225 higher to 118.625. April futures finished their trading life this afternoon and closed 3.475 lower to 116.000. For the week, June cattle traded 0.850 higher, and the August contract was 1.775 higher. Both contracts posted hook reversals on the week, which could bring some additional support next week. Friday’s trade was a round of short covering, leading the futures higher. This weas either due to the end of the month, or a change in trend. Next week will be a key for that turn. Cash market was wrapped up for the week with disappointing results. Most trade was $118-120, steady to lower than last week. The market was supported this week by the retail carcass values. Choice carcasses at midday were 2.61 higher to 296.37 and select gained 3.88 to 283.67on moderate demand of 56 loads. Today’s choice midday values were trading over $10.00 higher than last Friday’s close as carcasses have been firm all week. This should help support the cattle market next week, and maybe cash trade. Slaughter pace has been the limiting factor, as cattle slaughter has run heavy. Last week, total slaughter was 523,000 head, a higher for the year, and this week will likely be in that range. That has been the limiting factor in the cash market. The feeder cattle market failed to move with the live cattle markets as grain markets resurged this afternoon. May feeders lost 2.250 to 1133.60, and August feeders were 3.125 lower to 146.750. For the week, May feeders were 4.075 lower and closed on the lows for the week. Next week should be interesting as Live cattle technical look improved, but feeders are the exact opposite. Still hard to determine if a low is in for both markets.

LEAN HOG HIGHLIGHTS: Hog futures finished strongly higher to end the week, with a couple contracts trading the 3.000 limit higher. May hogs gained 1.400 to 110.125, while June hogs were 3.000 limit higher to 109.725, and July finished the 3.000 limit higher to 109.250. For the week, June hogs gained 4.000 and closed at a contract high weekly close. The cash market stays strong overall, despite the Lean hog index softening again today. The index lost 0.12 to 106.89. The demand is still the driver in the hog markets. Midday carcasses were strongly higher, gaining 4.10 to 111.65. Today, all major hog primal cuts trended higher at midday, showing the buying for pork product. Load was moderate at 195 midday loads. Carcass values have been choppy this week, and trading mostly within a range around the $110 level. Estimated hog slaughter today was 470,000 head, just under last week, and for the week, estimate total slaughter was 2,403,000, down slightly with last week. Slaughter pace has stayed strong, as packers are trying to meet the strong demand tone. Technically, hog futures are vastly improved from a couple weeks ago. The strong move in prices has June poised to pushed through the recent contract highs. Hogs will be trading the expanded limit of $4.500 on Monday due to the limit up closes in the June and July contracts today.

Top Farmer Midday Update 4-30-21

CORN

  1. May corn up 13 @ 7.15 & Dec up 2 @ 5.48
  2. Cash bids above delivery value – zero deliveries for May expiration
  3. 7-day forecast still hot & dry for in Brazil
  4. Believed Brazilian corn will drop below 100 mmt
  5. US corn demand remains very strong amidst tight supplies
  6. Argentine harvest at 19%
  7. O/I: Lost 14,254 positions in May futures

SOYBEANS

  1. May up 5 @ 15.48 & Nov up 5 @ 12.11
  2. Rumors of China cancellations of Brazilian soybeans
  3. Lower demand veg oil out of India due to Covid-19
  4. Argetina’s soybean harvest 30% complete
  5. Estimates for March soybean crush to hit 188.4 mb (last year 192 mb)
  6. O/I: Lost 12,042 positions in May futures

WHEAT

  1. May down 8 @ 7.29, KC down 5 @ 6.83, MNPLS up 3 @ 7.38
  2. Weather issues still key driver of market
  3. Dryness still prevalent and spreading in northern plains/Dakotas
  4. Cold weather putting EU’s French wheat crop in jeopardy
  5. Drought monitor continues to show spring wheat areas worsen
  6. 7-day forecast has minor rains for HRW areas
  7. Ukraine expected to produce 27.7 mmt for new crop wheat
  8. O/I: Lost 6518 positions in May wheat & lost 280 positions in KC May wheat

CATTLE

  1. June LC up .27 @ 116.32 & May down .50 @ 135.35
  2. Demand remains strong & boxed beef higher yesterday
  3. Weakening cash is a large hurdle for futures
  4. Today’s slaughter est. at 115K head
  5. Light cash trade seen 118-119
  6. Cash index for April for 27; down .15 @ 135.07
  7. Open interest lost 2,574 for June futures & lost 390 for May FC

HOGS

  1. June hogs up 2.90 @ 109.62 & June Pork Cutout @ 2.62 @ 115.25
  2. Tightening supplies expected to be the trend moving forward
  3. Exports may need to increase in order to keep supply from backing into domestic market
  4. Hog slaughter estimated at 478K head
  5. Cash lean index for April 27; down .38 @ 107.01
  6. O/I: Gained 317 for June hogs & June pork cutout lost 3 positions

Top Farmer Closing Commentary 4-29-21

CORN HIGHLIGHTS: Corn futures finished mixed as nearby May futures closed 15-3/4 cents higher at 7.02, and December lost 0-1/4 cent at 5.46-1/4. After the last two sessions, the technical picture looks very mixed as well. On the one hand, negative signals and reduction of long positions by managed money leaves the market vulnerable to further price pressure. We also believe planting progress will be strong and likely a record pace. While there is rain on the radar, most of it has been generally light in nature and has kept farmers out of the fields for a short period of time. Strong cash prices continue to provide support as noted with the strong gains posted by May futures. First notice day is on Friday, and it is expected that deliveries will be very minor, if any at all. This is also a reflection of tight inventory. New crop prices are at a level where if you are behind on sales, you should get current with recommendations. We feel strongly that the market is not likely to remain at current prices and is either vulnerable to sharp increases or eventually losses of a dollar or more. We anticipate the acreage estimate will rise from the March figure of 90.8 million. A rapid start to the planting season and high prices usually means more corn acres. Export sales at 20.5 million bushels were termed supportive. This brings the year to date total two 2.666 billion bushels or 99.7% of the USDA estate for the entire marketing year.

SOYBEAN HIGHLIGHTS: Soybean futures were weaker today, with May losing 15-1/2 cents and November down 9-1/4 at 13.18-3/4. Bullish traders must be somewhat dissatisfied with today’s close considering export sales at 10.7 million bushels were termed supportive. This brings the total year to date figure to 2.246 billion bushels. The USDA’s yearly estimate is now 2.280 which means 98.5% of expected sales have been achieved. As we indicated Monday, export inspections remain strong as well, which suggests there’s little likelihood of cancellations. Attention currently will focus on planting conditions, and we believe this may have pressured prices today, as did the idea of traders buying wheat and selling soybeans. After a major rally and new contract highs established earlier this week, a correction is expected. Soybean oil continues to be a very dominant commodity in the complex, as world demand remains steadfast. Next week the daily trading limit on soybeans will change from 70 cents to 1.00. This could lead to increased volatility.

WHEAT HIGHLIGHTS: May Chi wheat up 12 1/4 cents at 7.37 1/2 and Jul Chi up 6 ¼ cents at 7.29. May KC wheat down 3/4 cent closing at 6.88 1/2, while KC Jul closed down 2 cents at 6.94 1/2. Mixed wheat markets today as scattered showers fall across central Texas and SRW areas. There’s some rain in the forecast for eastern Colorado and Kansas this weekend however limited – most rains will be for SRW wheat areas. Today’s drought monitor shows significant increase of dry areas in the Midwest and similar (albeit smaller) areas in parts of Kansas and Oklahoma. No change in the northern plains and as the Dakotas just continue to get virtually zero precipitation and their soil conditions just continue to worsen. Wheat exports were nothing to be noticed which was pretty expected as US wheat continues to be over priced in a global market – total exports 223,000 mt – Mexico the top buyer. International Grain Council said it still expects record world wheat crop of 790 mmt for 2021-22 which is unchanged from last month. The market will likely look for that number to shift downward by next month’s estimate if the situation in the US doesn’t ease up and recent cold weather in the EU. Crop conditions are still favorable in Ukraine & Southern Russia. Ukraine announced wheat harvest likely to expand to 27.7 mt for 2021 – a little of 9% increase from previous estimates.

CATTLE HIGHLIGHTS: Cattle futures finished mostly higher on Thursday, and prices continue to consolidate above the key lows of April 26 established on the charts. April futures, which expire tomorrow, finished 0.525 higher to 119.475, and June cattle were 0.600 higher to 116.050. June futures have traded around the 116 level the past six sessions and are holding above the April 26 low of 114.550; a break below would open the door for further downside movement. Beef demand and carcass prices were the focus of the market today. Weekly export sales of beef last week were a consistent 23,600 MT, with South Korea, Japan and Mexico as the top buyers last week. Export shipments were at 18,700 MT up 2% from the 4-week average. Midday carcass values were stronger, as choice carcasses gained 0.96 to 293.46, and select 0.21 higher to 279.21 on moderate demand of 69 loads. The combination of strong carcass values and consistent export demand have failed to push the cash market higher. Cash trade is being limited by strong slaughter numbers, estimated at 481,000 head, steady with last week. Last week recorded the largest weekly kill totals for 2021. Cash trader recorded more direct sale business, ranging for $118-120 and dress trade at $189-191, both steady to softer than last week. Despite the strong packer margins, the large supply of available cattle keeps the leverage in the hands of the packer, limiting the cash market. Feeder cattle finish higher as well today. April cattle finished its trading life this afternoon, gaining 0.600 to 134.475, and May cattle were 0.875 higher to 135.850. A calmer day in the grain markets and strong live cattle futures helped support feeders, as they are trying to establish a near-term low.

LEAN HOG HIGHLIGHTS: Hog futures finished lower, giving back the gains established on Wednesday. May hogs lost 2.550 to 108.725, and June was 2.400 lower to 106.725. Hog futures softened to test near-term support, with some concerns that the cash market may be nearing a top. The lean hog index softened for the first time since early February, losing 0.38 to 107.01. This was the fifth time the index traded lower since the start of the year. Likely not the beginning of a trend, but the May futures holding a 2.170 premium to the index may have brought some long liquidation. The demand market stays strong and supportive. Weekly pork export sales were 35,600 Mt, up 59% from the 4-week average as Mexico, Japan, and South Korea were the largest buyer of pork last week. China did add 2,000 MT of sales, but the light total may have helped make the market nervous. Export shipments were a marketing year high, 58,800 MT, reflecting the strong product movement. Pork carcasses were strong at midday, gaining 4.10 to 112.31 on 118 loads. The strength was seen in the belly cut today, supporting prices. Prices have been tending slightly softer this week, but if the retail market can hold the gains into the close, that should help support prices on the open on Friday. The trend in hog prices has been higher this week overall, but a strong close into the weekend will be key for direction of prices next week.

Top Farmer Midday Update 4-29-21

CORN

  1. May corn down 2 @ 6.84 & Dec down 7 @ 5.39
  2. Brazil’s Safrinha corn will remain dry – production concerns rise
  3. Northwestern parts of corn belt will see rains delaying fieldwork
  4. Fear corn may have topped out due to being higher than global corn
  5. Weekly exports 521K mt
  6. O/I: Lost 40,932 positions in May futures

SOYBEANS

  1. May up down 15 @ 15.42 & Nov down 12 @ 13.15
  2. US cash basis is still strong given tight supplies
  3. US soybean crush margins remain positive
  4. Weekly exports 292K mt
  5. Higher prices ahead? Nov has only topped out twice in April
  6. O/I: Lost 33,432 positions in May futures

WHEAT

  1. May up 1 @ 7.26, KC down 7 @ 6.82, MNPLS up 7 @ 7.31
  2. Western Russia & parts of Ukraine are too wet
  3. Northern plains continue to remain too dry and worsen
  4. Weekly exports 223K mt
  5. Ukraine likely to increase wheat harvest to 27.7 mt in 2021
  6. Paris milling futures slightly lower this week after contract highs Tues.
  7. O/I: Lost 66 positions in May wheat & lost 3,931 positions in KC May wheat

CATTLE

  1. June LC up .37 @ 115.82 & May up 1.55 @ 136.52
  2. Futures oversold and traders buying the recent move down
  3. Weekly exports 23,600 mt
  4. Today’s slaughter est. at 120K head
  5. Some cash trade seen 118-119
  6. Cash index for April for 27; down .15 @ 135.07
  7. Open interest lost 2,574 for June futures & lost 390 for May FC

HOGS

  1. June hogs down 2.27 @ 106.85 & June Pork Cutout down 1.75 @ 112.75
  2. Packers are still aggressively buying – volatility is high
  3. Higher feeder prices may limit production keeping supplies tight
  4. Weekly exports 35,600 mt
  5. Hog slaughter estimated at 486K head
  6. Cash lean index for April 26; up .22 @ 107.39
  7. O/I: Lost 877 for June hogs & June pork cutout gained 57 positions

Top Farmer Closing Commentary 4-28-21

CORN HIGHLIGHTS: Corn futures were volatile with a weak close for the second consecutive session after reaching new contract highs yesterday. May futures closed 9-1/4 cents lower at 6.86-1/4 and December 15-3/4 cents weaker at 5.46-1/2. A negative chart signal in the form of stochastics, as well as overbought conditions, likely had fund money reducing positions. The rally in corn this spring has been magnificent with cash leading the way. Because cash remains strong, we will initially view this as a correction. Yet, what appears to be a conducive forecast for corn planting could suggest more than half of the crop could be in the ground by the end of the upcoming weekend. That is a guess of course; however, many producers have made great progress so far and will likely finish up in record time. We had indicated yesterday that after a reversal it is really the day after that matters. Corn had a very difficult morning session with sharp losses but rallied back into positive territory only to move once again lower and finish very soft. We would not be surprised to see follow through selling again tomorrow. Managed money has a track record of liquidating three consecutive sessions.

SOYBEAN HIGHLIGHTS: Soybean futures finished mixed, with May gaining 8 cents closing at 15.57-3/4 and November down 14-1/2 at 13.28. Expectations for strong planting progress in the days and weeks ahead may have pressured November soybeans today. Yet, tight carryout and strong demand provides underlying support. The markets have accelerated upward, and it’s just not soybeans, it’s all row crops. Volatility becomes paramount, and you have strong days where prices are trading large ranges. This does not take away from the fundamental argument of tight inventory. Yet, all markets have a point where buyers simply begin to back away or search for other alternatives. The question for the soybean market is whether prices have reached that level. For the near term they may have. We believe it will take either weather or at least perceived weather adversity to generate new buying interest much above current prices. Soybean oil continues to look to be the leader, and what it boils down to is the world’s perception of vegetable oil supplies, weather, and how tight prices will be in the weeks ahead.

WHEAT HIGHLIGHTS: May Chi wheat down 8 1/2 cents at 7.25 1/4 and Jul Chi down 10 cents at 7.22 3/4. May KC wheat down 15 cents closing at 6.89 1/4, while KC Jul closed down 14 3/4 cents at 6.96 1/2. A choppy day within the grain markets – sellers came in in the overnight and the morning looked to be a day for the seller. Mid-day prices rebounded and traded positive only to give up around the lunch hour and turn negative again headed into the close. The short-term story has not changed for wheat. Wheat likes to follow the prices trend of corn and is currently under threat of extreme drought conditions in northern plains that continues to spread and worsen. Some rains are hitting the southern Plains today, helping SRW wheat areas but still leaving the Dakotas & Montana in desperate need for moisture and none on the horizon. Wheat crops in Europe appears to have survived the recent cold temps with minimal damage but crops could use more rain there as well. Ukraine and Southern Russia conditions are favorable and military tensions seems to be easing there versus inclining which is a good sign for now. Ultimately, wheat is still up against a global production year and the US has yet to see exports really take off this year. If we were hoping that might change soon, we are well over a $1.00 overpriced compared to Germany – and Russia is still garnishing a bulk of exports despite their export taxes. The market will wait and see what next Monday’s crop condition report says, if further declines in the wheat crop good/excellent drops below this week’s 49% will start to give a better look at what harm recent cold fronts did to the current crop.

CATTLE HIGHLIGHTS: Cattle futures failed to find buying support as most contracts finished lower. April cattle, nearing expiration on Friday, was 0.575 higher to 118.950, but June cattle were 0.400 to 115.450, and August cattle were 0.825 lower to 116.475. The nearing April expiration may be waying on the market in general, but the mixture on fundamentals are signaling different directions. Retail carcasses and beef demand has stayed strong, as carcass values were firmer at midday. Choice carcasses gained 1.40 to 292.39 and select finished 1.04 higher to 280.57 on good movement of 79 midday loads. Weekly export sales tomorrow will look to stay supportive and build off last week’s movement. Despite the strong demand, the cash market disappoints the market overall. Cash is starting to develop this week with the early direct trade ranging from $118-120, mostly steady to lower than last week. The biggest problem with the cash market is the amount of slaughter animals available, keeping leverage with the packer, despite the strong demand and margins. Last week, estimated slaughter was 523,000 head, and if that is accurate will be the largest for the year. Beef production last week was 550 million pounds, up 20 million from last week, giving the market the feeling that there is enough animals available to meet the strong demand. Feeder cattle followed suit and finishing lower today. April cattle were .325 lower to 133.875, with expiration coming tomorrow. May futures dropped .900 to 134.975, and August were 1.175 lower to 148.900. The volatility in grains and weak cattle market have limited the upside in feeder cattle. The cattle market is in consolidation mode, and extremely choppy. The price action has been weak, and a break lower is still a possibility as the market looks for a bottom.

LEAN HOG HIGHLIGHTS: Hog futures finished higher with strong gains as the May contract was 1.475 higher to 111.275, and June hogs finished 2.450 higher to 109.125. Hog futures have consolidated the past few sessions but broke out to the upside on Wednesday. Some of the strength may be tied to weekly exports sales being announced on Thursday and seeing some strength in anticipation of the number. The cash market has stayed supportive, and the trend in cash stays firm overall. The Lean Hog Index gained 0.22 to 107.39 as prices stay in an uptrend. Carcass values were soft at midday with pork carcasses slipping 0.81 to 109.87 on 138 loads. Pork carcasses have been trending softer this week but are still at historical highs as pork demand has been robust. The concern in the markets is packer margins, which have slipped negative with the strong cash prices and stabilizing retail values. If margin slides, that could slow the cash market strength and limit the potential upside for hogs. For right now, the technical picture in hogs looks very friendly, and that market seems poised to challenge the recent market highs in the June contract. Deferred contracts made that move today, closing at new contract highs.

Top Farmer Midday Update 4-28-21

CORN

  1. May corn up 24 cent @ 7.20 & Dec corn down 1 @ 5.61
  2. Rains replenish soil moisture across much of central and easter corn belt
  3. Argentine corn reported to be as much as 90 cents cheaper than US
  4. Brazil’s safrinha corn remain too dry
  5. Brazil corn production could drop under 100 mmt – under 109 mmt from USDA
  6. O/I: Lost 59690 positions in May futures

SOYBEANS

  1. May up 38 @ 15.88 & Nov up 5 @ 13.47
  2. Profit taking entered the market overnight/a.m.
  3. Veg oils also have followed suit
  4. Brazil’s soybean prices are down 4%
  5. Weather in easter Midwest improving – planting still slower
  6. O/I: Lost 24,878 positions in May futures

WHEAT

  1. May up 6 @ 7.39, KC up 2 @ 7.06, MNPLS up 5 @ 7.45
  2. Beneficial rains are moving across SRW areas
  3. Northern plains still in full drought and not getting better
  4. Ukrainian & Russian wheat are wetter for next 10 days
  5. German wheat 1.00 cheaper than US keeping exports weak
  6. O/I: Lost 180 positions in May wheat & lost 7,104 positions in KC May wheat

CATTLE

  1. June LC up .37 @ 115.90 & May down 1.52 @ 134.35
  2. June live cattle currently at discount to cash
  3. Strong demand & higher boxed beef should help support futures
  4. Today’s slaughter est. at 121K head
  5. Some cash trade seen 118-119
  6. Cash index for April for 26; down .28 @ 135.22
  7. Open interest lost 1,697 for June futures & lost 1000 for May FC

HOGS

  1. June hogs up 2.17 @ 108.85 & June Pork Cutout up 1.95 @ 114.75
  2. Strong cash & higher cutouts bring back buyers
  3. Futures look bullish – demand still very strong
  4. Hog slaughter estimated at 487K head
  5. Cash lean index for April 23; up .66 @ 107.17
  6. O/I: Lost 1411 for June hogs & June pork cutout lost 2 positions

Top Farmer Closing Commentary 4-27-21

CORN HIGHLIGHTS: Corn futures raced higher on the overnight trading the expanded limit higher at plus 40 cents in the May futures trading to a contract high of 7.20-1/2. Prices then went into a tailspin with new crop, after strong morning session gains, closed lower posting hook reversals. December reached a new contract high of 5.93 and closed 6-0 cents lower at 5.62-1/4. Increased prospects for rain in the central northern Midwest and expectations for strong planting progress may have been enough to limit gains and had traders taking off their long positions. Planting progress at 17% complete on yesterday afternoon’s USDA weekly progress report is 3% behind the five-year average. Soybean plantings are 3% ahead of the five-year average which may imply that farmers took a stab at planting soybeans first to capture premium for new crop delivery. We also believe planting progress for corn was slow due to cold weather as many were patient waiting for more optimal soil temperatures. Today’s reversal a new crop is concerning, and technical indicators did signal a sell for daily stochastics. The key with any trading day is really the day after. Overbought conditions have existed for some time and reversal on a day like today is not a shock. Yet, it may be a warning signal to the market that prices could be running out of steam. Strong basis and strong cash may suggest otherwise in the near term.

SOYBEAN HIGHLIGHTS: Soybean futures sank into the close, ending the session with double digit losses while posting negative hook reversals. May, after trading to a new high of 16.08-3/4, lost 19-1/4 cents, closing at 15.49-3/4. November lost 19-1/2 cents, closing at 13.42-1/2, 40-1/2 from the day’s high of 13.84-3/4. Soybean meal futures finished weaker, losing 3.00 to 5.00, while soybean oil finished firmer in May but negative territory on deferred contracts. Planting progress at 8% is above the five-year average, an indicator that farmers are concentrating on planting beans early to take advantage of what could be a very strong price inversion between old and new crop. Expectations for rapid planting progress in the weeks ahead will keep prices volatile and potentially negative after today’s reversals. We are concerned enough today that if behind on sales, get current with recommendations. We thought 16.00 was likely; it was hit today and did not hold. New highs for vegetable prices, in particular palm oil, provides underlying support. Considering it is only April 27, we do not believe there is any dry weather threat to the US crop. Yet, expectations are that Argentina may limit export sales of both corn and soybeans along with soybean products.

WHEAT HIGHLIGHTS: May Chi wheat down 5 3/4 cents at 7.33 3/4 and Jul Chi down 6 3/4 cents at 7.32 3/4. May KC wheat up 2 1/2 cents closing at 7.4 1/4, while KC Jul closed up 2 1/2 cents at 7.11 1/4. Wheat, similarly to corn and soybeans, surged in the overnight trade with Chicago May trading as high 7.73. Prices still are ultimately very strong all things considered; however, a turnaround Tuesday after hitting contract highs from a technical standpoint is usually a bearish sign, not bullish. Some rains are expected for the Plains; however, the driest areas in the north are still left dry for the next 14 days and possibly longer headed into summer. Wheat is still driven by weather, both here in the US, and concern about EU weather as well helps keep prices moving higher. However, even if weather were to turn around, wheat ultimately wants to follow corn, which remains a very strong market that doesn’t seem to want to put in a top yet. Either way, it looks promising for wheat to at worse, trade sideways or at best, move higher, if corn pushes upward. USDA dropped US winter wheat crop ratings to 49% good/excellent, down from last weeks’ 53%. 28% of US HRS crop is planted versus the 5-year average of 19%. As grain prices continue to topple prices that haven’t been since in over 8 years. Eventually this will spill over into the US consumer’s pocket book, as well as end user’s, who will have to pass along the cost to grocery stores if prices don’t break soon.

CATTLE HIGHLIGHTS: Cattle futures failed to hold early session gains and traded lower on the day. April cattle were 0.125 lower to 118.375, and June dropped 0.425 to 115.850. April cattle expire on Friday, April 30. Despite a strong move higher in boxed beef values, a lack of response from the cash market pressured the live cattle market overall. Cash trade was very light, but some deals were seen in the South, ranging from $118-120, mostly steady with last week. Still not enough to establish a trend for the week but makes the market cautious. Fed Cattle Exchange will run again on Wednesday and will help develop the trend for the week. Retail carcasses are trying to support the cash market, but even with its strength, failed to boost the bids today. Choice carcasses were a strong 4.52 higher to 289.72, and select followed suit, up 4.81 to 279.16 on good movement of 72 midday loads. It is still apparent that regardless of high prices, the demand for beef has stay at strong levels. The price action today was very poor and has the market set up for some additional follow through selling tomorrow, despite the value in the cattle market. Feeder cattle finished mixed as the grain markets took a pause from their strength. April feeders, which expire tomorrow, were 1.450, trying to catch up to the cash index trading at 135.22. May feeders saw the brunt of rollover selling, dropping 1.400 to 135.875. For both live and feeder cattle, April expiration will likely keep the market choppy, and possibly under pressure through the end of the week.

LEAN HOG HIGHLIGHTS: Hog futures finished mixed in choppy overall trade on Tuesday, and prices did work off session lows, finishing near the top of the trading range for the day. May hogs gained 0.550 to 109.88, but the actively traded June contract lost 0.175 to 106.675. Prices were in consolidation trade today, looking for direction and possibly pushing higher, being lead by the on-going strong fundamentals in the market. Cash trade stayed strong, as the Lean Hog Index gained another 0.66 to 107.17, holding its upward trend. June hogs are now trading at a discount to the index, and that should help support prices. Carcass values resumed their strength at midday today. Carcasses were 2.97 higher to 112.27, on good demand of 241 midday loads. The demand strength will be able to support this market as overall pork supplies are tight, and the U.S. consumer and the export market are looking for product. The price action, despite being mixed to lower today was good, as prices pushed to the top of the range for the day at the close. This could bring some additional strength on the open tomorrow, especially in retail carcasses hold their value into the close today.

Top Farmer Midday Update 4-27-21

CORN

  1. May corn up 25 cent @ 7.05 & Dec corn up 4 @ 5.73
  2. Daily export sale of 101,600 mt of corn to unknown destination
  3. Brazil still too dry – talk of lower corn crop being inevitable
  4. Talk of China is in need of US new crop corn
  5. US corn 17% planted
  6. O/I: Lost 40739 positions in May futures

SOYBEANS

  1. May up ¾ cent @ 15.69 & Nov down 3 @ 13.59
  2. Will ASF impacts China’s need for soybean imports?
  3. Old crop soybeans touched $16 in overnight
  4. Tight stocks and rising demand from domestic crushers
  5. US soybeans 8% planted
  6. O/I: Lost 20995 positions in May futures

WHEAT

  1. May up 5 @ 7.44, KC May up 13 @ 7.14, MNPLS May up 9 @ 7.51
  2. Plains still remain dry – feeding bulls
  3. Old crop corn up limit again today lends more support to wheat futures
  4. USDA lowered overall wheat rating from 54% last week to 49%
  5. 28% of spring wheat is planted – ahead of the 19% 5 year average
  6. Ukraine plantings are behind schedule due to cold
  7. O/I: Lost -54 positions in May wheat & lost -5300 positions in KC May wheat

CATTLE

  1. June LC up .60 @ 116.87 & May down .02 @ 137.25
  2. Cattle on feed seems to be inviting buyers back
  3. Today’s slaughter est. at 119K head
  4. Cash trade needs to improve this week
  5. Cash index for April for 22, down 1.17 @ 136.36
  6. Open interest lost 1,960 for June futures & lost 602 for May FC

HOGS

  1. June hogs up .02 @ 106.87 & June Pork Cutout flat @ 112.97
  2. Hogs continue to bounce back despite grain rally
  3. At best hogs move higher – appears demand should keep prices at least sideways
  4. Hog slaughter estimated at 487K head
  5. Cash lean index for April 22; up .52 @ 106.51
  6. O/I: Lost 427 for June hogs & June pork cutout lost 2 positions

Top Farmer Closing Commentary 4-26-21

CORN HIGHLIGHTS: Corn futures rallied again today with May closing higher for the sixth consecutive session, gaining 25 cents closing at 6.80-1/2. New crop December gained 17-1/2 and finished the session at 5.68-1/4, another new contract high close. Today’s high in December was 5.73-1/4. The low from March 31 is 4.49-3/4, which means new crop has rallied over 1.70 in little over three weeks. Incredible. Supporting prices today with a five-week low in the US dollar, talk of Argentina imposing export tariffs, and a forecast of mostly dry for both Brazil and parts of the Midwest both already dry. Short covering was a noted feature as funds remain long as was reflect it on Friday’s Commitment of Traders report which indicated long managed money positions just under 400,000 contracts as of last Tuesday. Sharp gains in wheat and spillover support from stronger soybeans was also noted and helped to provide support for prices today. Export inspections at 76.8 mb was supportive. This makes the year-to-date figure 1.623 billion bushels. This means that 60.7% of expected sales of 2.675 billion bushels has been inspected. If Argentina does in fact require an export tariff this would likely mean less corn and soybeans available from this country to the world.

SOYBEAN HIGHLIGHTS: Soybean futures finished with sharp gains on continued supply concerns as well as additional fund buying. The trend remains sharply higher and may now be reaching levels where rationing is likely. May futures gained 29-1/4 ending the session at 15.60, a new contract high and new crop November up 20-1/4 closing at 13.62. Export inspections at 8.6 million were supportive bring the year-to -date total to 2.031 mb and 89.1% of expected yearly sales. A weaker dollar and higher soybean oil price were supportive as was reports that Argentina will likely raise export tariffs effectively limiting export supplies to keep inventory in country and slow down inflation. Lastly, the way the soybean market has moved higher in recent weeks could be reflective of a growing belief that the Brazilian crop is not nearly as large as forecasted. Record high prices in Brazil and growing world demand for not only protein but oil products are providing underlying support for soybean prices. We have mentioned several times that we did not believe prices were moving high enough to ration inventory. Now rationing maybe starting to take effect and it may be the market views this as too little too late.

WHEAT HIGHLIGHTS: May Chi wheat up 29 ¼ cents at 7.39 1/2 and Jul Chi up 27 1/4 cents at 7.39 1/2. May KC wheat up 28 1/2 cents closing at 7.01 3/4, while KC Jul closed up 28 1/4 cents at 7.08 3/4. Chicago wheat hit prices levels unseen since 2013 today – fueled by old crop corn limit up for the day and the market still trading poor weather conditions in key growing areas. Noncommercial buying in KC wheat also helped add fuel to the fire for the wheat complex. Friday’s data showed managed money at 22,225 – up from just a little of 7000 last week. Domestic weather is expected to improve for eastern areas of HRW wheat production areas – but the northwest Plains are expected to get anything soon, causing their drought to worsen and expand. Only upside to that is it leaves good conditions for anyone needing to plant spring wheat but doing no favors for the current growing season of HRW. Winter wheat crops are still being reported as favorable in Ukraine & Southern Russia while parts of Europe are very much like us here in the US – conditions unknown after recent cold blasts in the last couple weeks. The market is likely to trade today’s crop condition report tomorrow. It was feared the good/excellent rating would decline and sure enough it has from 53% last week to 49% — the market will likely expect another drop in next Monday’s report as well as it will take a couple weeks for the effects to fully be seen.

CATTLE HIGHLIGHTS: Cattle futures finished higher to start the week, working off early session selling pressure. April cattle gained 0.650 to 118.650, and June cattle were 0.550 higher to 116.275. The Cattle on Feed report last week was slightly under expectations but still keeps the front month supply of cattle relatively heavy. Producers fearing the higher feed costs are looking to market cattle more quickly, keeping pressure on the front end of the market. Regardless, the cattle market is under-valued, and the demand tone stays strong, supporting prices. The cash market was quiet to start the week, typical for a Monday. The cattle market is looking for a steady to higher cash trade, but the packers seem to still have the leverage. Carcass values are historically strong but traded mixed at midday today. Choice carcasses were slightly lower, down 0.77 to 283 but Select was higher up 1.82 to 273 on light movement of 42 loads. Regardless, choice carcasses at $280+ should support the cash market as packer margins remain strong. Technically, the cattle market is trying to find a bottom, and did post reversal action today on the daily charts, but the key will be follow-through into tomorrow and beyond. Feeder cattle finished mixed to mostly lower. April feeders expire on 4/29 and traded 1.100 lower to 132.70, and May feeders lost 0.400 to 137.275. The strong move higher in the grain markets limited feeder upside.

LEAN HOG HIGHLIGHTS: Hog futures saw buying strength to start the week, as summer contracts posted triple digit gains. The lightly traded May contract was 0.100 lower to 109.250, but holding a premium to the index, a limiting factor. June hogs posted a 1.125 gain to 106.850, and July hogs finished 1.150 to 105.675. The strong demand tone and the prospects of longer-term demand in the fact of tighter hog numbers have the hog market looking poised to rechallenge the contract highs. The cash market stays strong, as the Lean Hog Index continues to climb. The index gained 0.52 to 106.51, the index is at a 2.74 discount to May futures, limiting the front month. The strength in the market is the retail demand. China is still dealing with ASF issues, and the hog market is expecting the Chinese and global demand for U.S. pork to continue. Pork carcasses were 0.84 lower to 111.10, but trading at all-time high values with the exception of last year’s COVID aided price rally. The grilling season and strong domestic demand around the corner, pork carcass values have a strong chance of clipping that mark. Technically, the hog market is strong and today’s price action was encouraging, the hog market shook of early selling pressure to settle near the top of today’s trading range, setting up the strong possibility of follow through buying tomorrow.

Top Farmer Midday Update 4-26-21

CORN

  1. May corn up 25 @ 6.80 & Dec corn up 17 @ 5.68
  2. Export inspections 1.951M mt up from last weeks 1.524M mt
  3. Corn up limit today as S. American weather still too dry
  4. Managed money 383K contracts long
  5. Argentina considering increase in grain export taxes
  6. O/I: Lost 63,365 positions in May futures

SOYBEANS

  1. May up 23 @ 15.63 & Nov up 16 @ 13.58
  2. Export inspections 233K mt up from last week’s 183K mt
  3. Soybeans fueled by corn & Malaysian palm oil futures
  4. Supplies remain incredibly tight & demand still strong
  5. Export daily sale of 120,00 mt of soybeans to unknown delivery
  6. Managed money 172,544 contracts long
  7. O/I: Lost 32,798 positions in May futures

WHEAT

  1. May up 33 @ 7.43, KC May up 32 @ 7.06, MNPLS May up 25 @ 7.43
  2. Export inspections 564K mt down from last week’s 613K mt
  3. Paris milling futures higher again today – new contract high
  4. Global wheat prices increasing – planting delays in Russia
  5. Southwestern plains & hard red winter wheat areas getting very little rain next 14 days
  6. Managed money 18K contracts long KC wheat and 1500 contracts long Chicago
  7. O/I: Lost 8863 positions in May wheat & lost 2384 positions in KC May wheat

CATTLE

  1. June LC up .07 @ 115.80 & May FC down 1.42 @ 136.25
  2. Cattle on Feed placements lower than expected
  3. Feeder cattle pressured by limit up corn
  4. Today’s slaughter est. at 119K head
  5. Cash trade needs to improve this week
  6. Cash index for April for 22, down 1.17 @ 136.36
  7. Open interest lost 648 for June futures & lost 635 for May FC

HOGS

  1. June hogs down .15 @ 105.57 & June Pork Cutout down .92 @ 111.30
  2. Cash continues to improve as packers remain aggressive
  3. Lower cutouts Friday might mean prices are reaching threshold – sideways trade ahead?
  4. Hog slaughter estimated at 484K head
  5. Cash lean index for April 21; up .87 @ 105.99
  6. O/I: Lost 1185 for June hogs & June pork cutout lost 8 positions

Top Farmer Closing Commentary 04-23-2021

CORN HIGHLIGHTS: Corn futures finished the week mixed with choppy action on Friday as May corn saw additional buying strength gaining 5 cents to 6.55-1/2, Jul corn finished 1 cent higher to 6.32-1/2, and Dec corn was 2-1/2 lower to 5.50-3/4. For the week, May corn finished 70 cents higher, while Jul added 58-3/4 cents. Bull spread has been the theme all week with strong buying strength in the front-month contracts, and that pattern held today despite the choppy trade. The Jul/Dec corn spread has had a strong week gaining 21 cents. The front-month strength can be tied to the cash market strength as end-users are pushing to secure supplies through the futures market. In addition, weather concerns regarding dryness in Brazil affecting the second-crop corn, have sent Brazilian corn prices to record highs on tight supply fears. Those supply fears globally will likely keep demand for U.S. corn active, and despite the strong markets, the U.S. has landed a few export sales this week. Mexico bought corn early in the week, and this morning the USDA announced two sales of new crop corn. Unknown destinations bought 336,000 MT, and Guatemala picked up 136,000 MT of corn for the next marketing year. Going forward, the market will be focusing on U.S. planting progress, expected to reach 18% complete next week, and an ongoing watch for Brazil weather. The market is overbought and will remain extremely volatile, but the momentum stays supportive going into the weekend.

SOYBEAN HIGHLIGHTS: Soybean futures had a rough start in the morning but certainly didn’t stay there. May futures closed at 15.39-3/4, up 6-1/2 cents and Nov ended the session with gains of 3-1/4 cents closing at 13.41-1/2. An impressive 93-1/2 cent gain for the week – high close since July of 2013 for front-month futures. U.S. basis is stronger than it’s been in 8 years as buyers desperately try to get their hands on what minimal old crop soybeans are still out there. Exports have moved to Brazil and yet our prices continue to climb higher. The price discrepancy between the U.S. and Brazil is not stopping China – USDA reported a sale of 132,000 mt of soybeans were sold to China this morning for 2021-22. Between the global demand and domestic demand proving not to be slowing down yet, the top does not appear to be in for the soybean market. In the coming weeks, the market will reflect on our own planting progress and producers are ready for fieldwork and just need the weather to cooperate. Reminder next Friday is first notice day for May futures.

WHEAT HIGHLIGHTS: May Chi wheat flat, closing at 7.10-1/4 and Jul Chi up 1-3/4 cents at 7.12-1/4. May KC wheat up 5-3/4 cents closing at 6.73-1/4, while KC Jul closed 5-3/4 cents at 6.80-1/2. KC wheat closed higher than it has since 2014 – it’s impressive to wheat rally as much as it has not just this week but honestly just in the last year. Exports have not picked up to the kind of demand seen in corn and, globally, wheat has continued to produce record-breaking crops. Right now wheat is in a full-blown weather market, as dry weather in the U.S. Plains continues to dominate the trade trend. Also, this week was the accompanied cold temps that came through much of wheat country Wednesday and Thursday – potentially damaging wheat that’s already emerged in key areas like Kansas. We will see what Monday’s crop condition report says, as far as if ratings get lowered from good/excellent – however the market is probably going to be forgiving and look at the next two crop condition reports to validate whether there was damage from this week’s weather. Also, too cold this week was Europe and there is more on the horizon this weekend. Russian troops are supposed to start to pull back starting today which should ease concerns over trade activity possibly being disrupted in Russia/Ukraine.

CATTLE HIGHLIGHTS: Cattle futures finished mixed to end the week as selling pressure stayed on the front end. Apr cattle lost 0.475 to 117.850 and Jun dropped 0.125 to 115.725. Deferred contracts saw some buying support as the Oct-Apr 22 contracts were 0.600-0.925 higher. For the week, Jun cattle dropped 3.450 on continued long liquidation. The market was choppy today and squaring positions for the April USDA Cattle on Feed report this afternoon. The report was mostly below expectations as Total cattle on Feed as of April 1 was 105% of last year, Placements were below expectations at 128%, and marketings inline at 101%. The numbers are skewed if you compared to last year and the cattle industry dealing with the COVID issues. However, going back to 2019, the total cattle on feed is slightly below those levels at 11.897 million head versus 11.953 million head in 2019. The total is the second-highest cattle total on record after 2019. The numbers overall look relatively friendly and the cattle market is undervalued, especially in the deferred contracts. Retail demand stays supportive as carcasses were mixed at midday. Choice carcasses were 1.01 higher to 283.32, but select was 1.28 softer to 272.41 on moderate demand of 92 midday loads. Choice carcasses at this level are trading at the 2nd highest price level in history, with only last year’s COVID pandemic prices higher. The stronger retail values have failed to support the cash market. The cash market was quiet today, but cash prices were steady to softer in most regions with $119-120 in the south and $120-122 in the north. The feeder cattle market saw some short covering, supported by a calmer grain market today. Apr feeders gained 1.600 to 133.850, and May gained 0.650 to 137.675. For the week, May feeders were under strong selling pressure losing 6.050 in total.

LEAN HOG HIGHLIGHTS: Hog futures stayed choppy, but the buyers returned to end the week. May hogs gained 1.900 to 109.350, and the Jun hogs were 2.175 higher to 105.725. For the week, May hogs gained 6.875, closing at a new contract high, and Jun was 4.025 higher. The hog market was supported by the retail demand and a pork supply picture. The USDA Cold Storage report released yesterday afternoon was supportive showing that frozen pork supplies were down 7% from the previous month and down 27% from last year. Stocks of pork bellies were down 6% from last month and down 55% from last year. This tighter supply was reflective of the strong domestic and export demand. Carcass values are trending close to all-time highs and were strong at midday. Pork carcasses were 2.55 higher at midday to 117.25, just 44.00 of the all-time high from last spring. Demand was light to moderate at 125 loads. This demand-driven market has fueled the cash market as the Lean Hog Index has trended higher for 12 straight weeks, and gained an additional 0.87 today to 105.99, pulling the front-month contracts higher. The demand tone in the market will still stay active as the global supply picture for hogs is at a 45-year low and the world is looking for pork products. The technical picture looks improved, as prices rebounded off of last week’s lows, and have consolidated, positioning for a move higher, led by the fundamentals.

Top Farmer Midday Update 04-23-2021

CORN

  1. May down 1 @ 6.49 & Dec down 4 @ 5.48
  2. Funds long 560,000 contracts of corn
  3. Matif corn futures making 8 year high
  4. Argentina crop weather will continue to be positive for next 2 weeks
  5. Stress to Safrinha corn in Brazil expected to worsen
  6. Heavy rains expected in Eastern Corn Belt next week
  7. O/I: Lost 17,219 positions in May futures

SOYBEANS

  1. May up 10 @ 15.43 & Nov up 4 @ 13.42
  2. Funds long 219,000 contracts of soybeans
  3. Positive US crush margins – carryout might come down from USDA #
  4. Surging veg oil markets have helped push soybeans this week
  5. Margins increased by CME to 3350
  6. O/I: Lost 16,025 positions in May futures

WHEAT

  1. May down 5 @ 7.04, KC May down 2 @ 6.65MNPLS May up 6 @ 7.15
  2. Funds long 35,000 contracts of Chicago wheat
  3. Spring wheat areas are still too dry & in Europe
  4. Paris milling futures fall today after 8 days in a row higher
  5. Drought keeping MNPLS wheat up – new contract highs
  6. O/I: Lost 5,488 positions in May wheat & lost 4,267 positions in KC May wheat

CATTLE

  1. Jun LC down 0.10 @ 115.75 & May FC up 0.52 @ 137.55
  2. Cattle on feed released today at 2:00 CT
  3. Many fear the top may be in for cattle
  4. Today’s slaughter est. at 118K head
  5. Cash trade lower this week from 118-119
  6. Cash index for April for 21; down 0.80 @ 137.53
  7. Open interest lost 2940 for June futures & lost 646 for May FC

HOGS

  1. Jun hogs up 1.75 @ 105.30 & Jun Pork Cutout up 1.47 @ 111.92
  2. China March production up 28% from Feb
  3. Higher cash & cutouts should provide support despite grain prices
  4. Hog slaughter estimated at 481K head
  5. Cash lean index for April 20; up 0.70 @ 105.12
  6. O/I: Lost 352 for June hogs & June pork cutout gain/lost 0 positions

Top Farmer Closing Commentary 04-22-2021

CORN HIGHLIGHTS: Corn futures finished with explosive gains as front months May and Jul finished limit higher gaining 25 cents each. May closed at 6.50-1/2 and Jul at 6.31-1/2. New crop Dec gained 16-3/4 cents ending the session at another new contract higher close of 5.53-3/4. Export sales were on the slow side but still positive with 15.3 mb, bringing the year-to-date total up to 2,645.5 mb. This compares to 1,391 bb a year ago for this same week. The current yearly USDA estimate is 2.675 bb which implies 98.9% of year sales have been achieved. Talk has been circulating that China is buying more U.S. corn along with expectations for an increase, according to the USDA attaché to China, for up to four million additional metric tons. Dry weather in Brazil, a weaker U.S. dollar, a strong technical picture, and reports indicating Brazil would suspend import tariffs all aided in stronger futures prices. The market has reached many of our upside technical targets yet, with prices shooting higher it is possible there is more to go. Yet, be very cautious. Markets often accelerate toward a top and while it is dry, one should expect planting progress to be strong and a high likelihood acreage will exceed the March 31st estimate. Higher ethanol margins alone were supportive again today, as were sharply higher soybean and wheat prices.

SOYBEAN HIGHLIGHTS: Soybean futures rallied sharply in conjunction with significant advances in the corn and soybean markets. May futures closed at 15.33-1/4, up 36 cents and Nov ended the session with gains of 28 cents closing at 13.38-1/4. Soybean oil again led the charge higher establishing new contract highs and trading at its highest level since 2008. Soybean oil futures have now exceeded prices from the 2012 drought. Export sales at 2.4 million were uneventful, yet as mentioned in the past, positive sales are supportive as the concern of cancellations is less likely. Year-to-date export sales are now 2.235 bb and 98% of the USDA forecasted 2.280 billion. Wet weather challenges for Argentina trying to harvest crop along with an announcement yesterday that Brazil would suspend import tariffs has provided underlying support for soybeans, as has continued supply problems with world vegetable oils. We have argued for some time that we thought the soybean futures did a poor job of rationing inventory and until this last week usage was viewed as too strong. Now that prices are moving higher demand may diminish. If processors process less, that means tighter meal and oil and, in part why those markets have exploded this week. We do not believe U.S. farmers are holding much inventory and that it is highly likely that the USDA projected carryout at 120 mb bushels is too robust.

WHEAT HIGHLIGHTS: May Chi wheat up 37 cents closing at 7.10-1/4 and Chi Jul up 35-1/2 cents at 7.10-1/2. May KC wheat up 36-3/4 cents closing at 6.67-1/2, while KC Jul closed up 37 cents at 6.74-3/4. New contract highs set today, as wheat rocketed higher due to cold weather reaching as far south as Texas yesterday. Cold weather remained through today but not as frigid as previously thought. Not new news per se, but the market is also trading the fact that there is no rain built into the forecast for at least the next week for spring wheat areas in the U.S. Again, the threat of cold temps in Europe this week adds bullish pressure to wheat prices from a global stance. Paris milling futures took out yesterday’s contract high and replaced it with another one today. Exports weren’t anything worth mentioning today at 240,200 MT. Aside from weather concerns in the U.S. – the situation in Russia and Ukraine continues to keep traders on edge. It was reported today that Russian Defense Minister said troops should be withdrawn over the next week – all eyes will be on whether that happens or not.

CATTLE HIGHLIGHTS: Cattle futures finished lower as technical selling weighed on the market as Jun cattle traded to their lowest price levels since January. Apr cattle were down 1.450 to 118.325, and Jun cattle dropped 1.400 to 115.850. Beyond the technical pressure, a strong move higher in grain markets triggered selling in the livestock complex, and especially in feeder cattle, which posted strong triple-digit losses. The cash market has also been a disappointment and has stayed steady to softer than last week. Most southern trade is ranging $119-120 and northern trade from $121-124. The softer tone has come in the face of ongoing strength in the retail box beef trade. Choice carcasses were 0.93 higher to 281.39 and select was 2.91 higher to 274.79. Demand was light to moderate on 63 loads at midday. The strong retail has been boosting packer margins, but fail to push the cash bids, as available supplies of cattle are out in the countryside. The surge in grain prices may only push the movement of cattle, given the tighter margins and costs of inputs. The cattle market is also squaring up long positions for Friday’s Cattle on Feed report. Expectations are for cattle on feed at 106%, placements at 134%, and marketing at 101%. Those numbers will look skewed vs the COVID lockdown situations last year, and the market may look towards trends from 2019 instead. Prices will likely stay choppy and pressured to close the week, going into the report. Feeder cattle finished with strong triple-digit losses as Apr feeders dropped 2.850 to 132.250, and May lost 2.575 to 137.025. Strong grains and a weak technical picture added to the selling pressure in the feeder market on Thursday. The cattle market is strongly oversold, but the momentum is still pushing prices lower going into the end of the week.

LEAN HOG HIGHLIGHTS: Hog futures saw additional follow-through selling as the hog market saw additional long liquidation and technical selling pressure. May hogs slipped 0.150 to 107.450, and Jun lost 0.975 to 103.550. The hog market is still looking for a bottom and may be in the building process of finding that floor. Weekly export sales added a bit of confusion this week as the USDA made a correction from the market being over-reported in 2020. Net sales for the week were at -22,100 MT, as over-reported 54,476 MT for Mexico in 2020 were taken from the weekly totals. That may have added some selling pressure to the market in general. Overall, exports saw China add 13,1000 MT last week, and weekly shipments were a market year high of 43,900 MT. Other fundamentals stay supportive as the cash market stays aggressive. The Cash Hog Index gained 0.70 to 105.12. Midday carcass values were supportive at 114.20, gaining 0.56 on moderate demand of 207 loads. At $114, pork carcasses are trading just below the high for pork carcasses at $121, established last year during the COVID pandemic price surge, and nearly $60 above the 5-year average. The hog market is extremely oversold, and the strong grain markets are keeping selling pressure in the livestock complex overall.

Top Farmer Midday Update 04-22-2021

CORN

  1. May up 25 @ 6.50 & Dec up 15 @ 5.51
  2. Weekly export net sales at 387,500 MT
  3. Outlook for S. Brazil looks mostly dry into 1st week of May
  4. Brazil corn prices have moved higher to equate 7.35 bu
  5. Argentina on tap for heavy rains which will slow harvest
  6. O/I: Lost 19,855 positions in May futures

SOYBEANS

  1. May up 37 @ 15.34 & Nov up 27 @ 13.37
  2. Weekly export net sales at 64,300 MT
  3. Soybean harvest winding down in Brazil
  4. Brazil beans still 30-40 cent discount to US
  5. Basis in US as high as 70 over in some parts of the country
  6. O/I: Lost 14,153 positions in May futures

WHEAT

  1. May up 29 @ 7.01, KC May up 29 @ 6.60, MNPLS May up 28 @ 7.07
  2. Weekly export net sales at 240,200 MT
  3. Contract highs hit in all 3 wheat markets
  4. World wheat prices move higher this week
  5. Russian & Ukraine tensions continue to threaten export market globally
  6. Drought remains in US northern Plains – no relief in sight
  7. O/I: Lost 4,766 positions in May wheat & lost 2,625 positions in KC May wheat

CATTLE

  1. June LC down 0.67 @ 116.55 & May FC down 2.45 @ 137.15
  2. Weekly export net sales at 24,600 MT
  3. Boxed beef still showing significant gain – reflecting strong demand
  4. Today’s slaughter est. at 118K head
  5. Cash trade expected to stay steady around 120-121
  6. Cash index for April for 20; down 0.15 @ 138.33
  7. Open interest lost 2450 for June futures & lost 514 for May FC

HOGS

  1. June hogs down up 0.17 @ 104.70 & June Pork Cutout up 0.45 @ 112.12
  2. Weekly export net sales reported reductions of 22,100 MT
  3. China indicated pork imports will continue to increase over 2020 levels
  4. Hog slaughter estimated at 489K head
  5. Cash lean index for April 19; up 0.66 @ 104.42
  6. O/I: Lost 17 for June hogs & June pork cutout lost 12 positions

Top Farmer Closing Commentary 04-21-2021

CORN HIGHLIGHTS: Corn futures climbed again today with front-month futures leading the rally as bull spreading was a noted feature. May futures finished 19 cents higher at 6.25-1/2 and Dec 8 firmer at 5.36-1/2. Short covering after prices broke overhead resistance and new contract highs established on the heels of continued concern over dry weather in Brazil and a later than expected start for many in the U.S. due to cold weather. Strength in wheat and soybean prices were also noted and likely helped propel corn prices higher. The backdrop of strength in the front months is a strong cash market reflecting light farmer selling, strong end-user demand, and the need to fill the pipeline of strong export activity, ethanol demand, and feed. Private forecasters are continuing to suggest a potential downgrade of up to 20% of expected second crop Brazilian corn. While not off to the greatest of starts, we do not anticipate a major issue with U.S. planting. For most producers, lessons learned in past years suggest that planting into cold weather and cold soils isn’t ideal in a practice they’ve moved away from. With warmer temperatures on tap expect planting to move along rapidly.

SOYBEAN HIGHLIGHTS: Soybean futures were the recipient of bull spreading and double-digit gains in front-month futures with May closing 25-1/4 cents higher at 14.97-1/4 and Nov 10-3/4 cents higher at 13.10-1/4. May reached a high of 14.99-3/4, while not 15.00 it nonetheless represents a price more in line historically with where prices have been expected to head to with a stock to usage figure of 2.6%. In recent sessions, the day and results have been nearly the same and so has the story. Downgrades to the Brazilian crop due to weather conditions and most lately a potential downgrade to the Argentine soybean crop due to wet conditions is providing underlying support after a very robust demand market. As mentioned in previous reports, the projected ending stocks figure at 120 million bushels, by many analysts, is too high. Fund money continues to be a buyer and sellers are reluctant as any past sales have proven to be a mistake, at least through the current price trend. Perhaps more importantly, we do not believe farmers are holding significant inventory in recent history has indicated very light selling when prices do set back. Soybean oil continues to lead the rally breaking into new contract high prices. Tight world supplies of vegetable oils and expectations that crushing facilities could slow due to lack of supply are aiding in the perception of tightening longer-term oil supplies. It finally appears the market is beginning to ration supply.

WHEAT HIGHLIGHTS: May Chi wheat up 13-1/2 cents closing at 6.25-1/4 and July Chi up 13-3/4 cents at 6.75. May KC wheat up 10 cents closing at 6.30-3/4, while KC Jul closed 9-3/4 cents at 6.37-3/4. Another higher close in wheat all across the board, as cold temps last night in the western Plains plan to stay in place at least through the end of the week. Kansas is at risk, with over 50% of the crop at the jointed stage (i.e. above ground), making it vulnerable to cold weather. Spring wheat, the concern is still hyper-focused on lack of precipitation in the 7-day forecast. Minneapolis wheat put in another contract high today, 6.78-3/4. Domestic weather continues to keep prices on the climb – following corn and soybean impressive push this week as well. Northern and eastern parts of Europe are also expecting another cold front this week which could further damage/threaten winter wheat crops – this helped Paris milling futures put in a new high today as well. In Ukraine & Southern Russia – crops are not the concern but political tensions pose the biggest threat regarding wheat. Russian troops continue to build up at the Ukraine border which could of course impact if not cut off exports temporarily which would be very bullish for all wheat markets.

CATTLE HIGHLIGHTS: Cattle futures failed to hold yesterday’s gains and broke to new lows during Wednesday’s session. Apr cattle were 0.800 lower to .119.775, and Jun dropped 1.950 to 117.250. The optimism that came into the market yesterday turned into a head fake as technical selling and long liquidation drove prices lower. In addition, a strong move higher in the grain markets triggered selling in the feeder market, and that pressure spilled over into the live cattle market. The cash market failed to support futures, as early cash trade started to develop today. Some light trade was established today at $120 in the South and $122-123 in the North, this trade was steady to lower than last week, adding to the selling pressure. Carcass values continued their surge higher, as choice carcasses gained 1.84 to 280.10 and select was up 2.06 to 272.53. Movement was moderate at 83 loads. Today’s estimated slaughter totaled 120,000 head, 5,000 more than last week, and 34,000 greater than a year ago. The market is also looking toward Friday’s Cattle on Feed report, and numbers will be difficult to register with estimates being skewed by last year’s COVID-aided shutdowns. Numbers will look elevated compared to 2020, and we may have to look towards 2019 for comparisons. Feeder cattle were sharply lower with strong losses. Apr cattle were 2.475 lower to 135.100, and May lost 3.175 to 139.600. Technical selling and the strong grain rally added the selling pressure in the feeder market.

LEAN HOG HIGHLIGHTS: Hog futures had the sellers re-establish themselves and finished with losses on Wednesday. May hogs lost 0.475 to 107.600, and Jun cattle slipped 1.825 to 104.525. The Jun contracts failed to push higher early in the session and turned negative on the charts again today. This may open the door for additional long liquidation tomorrow. The volatility in the hog market is more tied to technical trading, because fundamentals stay strong, trying to support prices. The cash markets remained strong, and the Lean Hog Index gained 0.66 to 104.42. The demand in the market remains aggressive as pork carcass values gained 2.76 to 117.79. At this level, pork carcasses are approaching last year’s product high of 121.66 from last May, and trading $43 above the 5-year average. The biggest difference this year is demand for pork globally is strong, and carcass values are not enhanced by the lack of supply from the slaughter plant shutdowns we saw last spring. Weekly export sales will be reported on Thursday morning and could help set the tone for the end of the week. The market is expecting improved numbers after last week’s disappointing sales. In addition, USDA will release the Cold Storage report after the market close on Thursday, which should give a snapshot of product movement.

Top Farmer Midday Update 04-21-2021

CORN

  1. May up 16 @ 6.22 & Dec up 8 @ 5.37
  2. Ethanol productions for the week ending 4/16 averaged 941K same as last week
  3. Strong cash and tight basis keep prices putting in contract highs 3 days in a row
  4. Late planted crops in Brazil will suffer due to dryness
  5. Brazil’s 20/21 crop could reach a record of 107. mt
  6. O/I: Lost 24,852 positions in May futures

SOYBEANS

  1. May up 19 @ 14.91 & Nov up 12 @ 13.12
  2. Argentina crop could be 51.5 million tonnes
  3. Veg oils continue to push futures higher in soybean complex
  4. China continues to reflect strong demand for soybeans
  5. US basis continues to soar as buyers look for limited old crop beans
  6. O/I: Lost 19739 positions in May futures

WHEAT

  1. May up 15 @ 6.75, KC May up 11 @ 6.32, MNPLS May up 10 @ 6.80
  2. US wheat damage occurred overnight in Oklahoma & Texas
  3. Rain prospects for northern Plains could improve in early May but dry until then
  4. Paris milling futures rose today on dryness & cold temps
  5. Recent frost & freezes in EU have induced damage
  6. O/I: Lost 6060 positions in May wheat & lost 4925 positions in KC May wheat

CATTLE

  1. Jun LC down 1.75 @ 117.40 & May FC down 2.80 @ 139.975
  2. Cattle on Feed out tomorrow – guess is placements up 33.7% from last year
  3. Prices continue to slip despite strong demand & higher boxed beef prices
  4. Today’s slaughter est. at 120K head
  5. Cash trade expected to stay steady around 120-121
  6. Cash index for April 19; down 1.65 @ 138.48
  7. Open interest lost 2404 for June futures & lost 1112 for May FC

HOGS

  1. Jun hogs down 0.42 @ 107.65 & Jun Pork Cutout down 1.95 @ 111.225
  2. Tightening supplies keeping packers aggressive
  3. Profit-taking likely to explain away today’s move lower
  4. Hog slaughter estimated at 489K head
  5. Cash lean index for April 16; up 0.52 @ 103.76
  6. O/I: Lost 744 for Jun hogs & Jun pork cutout gained 2 positions

Top Farmer Closing Commentary 04-20-2021

CORN HIGHLIGHTS: Corn futures ended with strong gains again pushing into another round of new contract high prices and closes. May finished the session at 6.06-1/2 up 14-1/2 and new crop Dec up 8-1/4 at 5.28-1/2. Increasing weather concerns with mostly dry forecasted the next 10 days had prices pushing higher and breaching 6.00 for the first time since July 2013. Firming ethanol prices along with cool weather limiting planting progress is suggesting old crop could be more difficult to come by. A strong export pace and competition among end-users to secure inventory from producers is reflected in a continued firming basis. A weak dollar over the last several weeks and high internal prices in both China and Brazil suggest the trend could remain higher. Another factor we believe has been supportive is a lack of necessity for U.S. farmers to be aggressive sellers. Between higher prices and government subsidies, there is a reasonable expectation their producers may be holding back some inventory to see how high prices may go. Our conversion has the price per bushel in Brazil near 7.80 U.S. dollars. Brazil has suspended import duties on corn and soy products until the end of the year combating rising food costs and inflation.

SOYBEAN HIGHLIGHTS: Soybean futures rocketed higher gaining well over 30 cents in the mid-morning time and eventually finished with moderate to strong gains of 22-1/4 cents in May closing at 14.72 after reaching a new contract high of 14.85-1.2. Strong demand, high internal prices in Brazil, and wet weather plaguing Argentine harvest are all concerns. Quality issues are also a concern for some of the Argentine crop as recent rains were viewed as a negative. A drop in the U.S. dollar has been supportive as well. A firming basis is likely the result of crushers pushing cash to secure enough inventory. Increasing palm oil prices and talk of a smaller crush in the U.S. due to expectations crushers could be tight on supplies is helping to support soybean oil which reached new contract highs today as well. Brazil has suspended import duties on corn and soy products until the end of the year combating rising food costs and inflation. Cold weather is delaying U.S. planting.

WHEAT HIGHLIGHTS: Although we don’t focus much on it, MNPLS May wheat today put in a contract high of 6.83-3/4 while closing at 6.69. May Chi wheat up 7-1/2 cents closing at 6.59-3/4 and Jul Chi up 7-1/2 cents at 6.61-1/4. May KC wheat up 8-3/4 cents closing at 6.20-3/4, while Jul KC closed 9-1/4 cents at 6.28. Although wheat backed off on the close somewhat today, there was night bullish pressure behind futures today. Widespread freeze from the north all the way to Texas for today and tomorrow has temps in the 20’s for key HRW areas which has the market concerned. Wheat in places like Oklahoma could be more susceptible to damage – some fear the cold front might be more severe than currently forecast. Truth is – damage is expected to be minimal but bulls love a good weather scare. Add on to that fact, corn and soybeans put in contract highs today as well – just opened the door for the wheat market to be bought. Dryness in the UK, France, and Germany has the market concerned – also followed by extremely cold temps a couple of weeks back adds concerns to potential crop stress. Ukraine & Russia’s crops are still looking good, but tensions there continue to keep traders watchful. If things were to escalate, it would severely impact the export markets there, which would be bullish for all wheat globally. The U.S. wheat would be no exception. Tack on the fact that dryness in the northern Plains is still very alive and not looking to get better anytime soon, there are lots of little nuggets in the market right now to keep the bulls satisfied.

CATTLE HIGHLIGHTS: Cattle futures broke the selling string of consecutive days by finishing higher on Tuesday’s trade. Apr cattle gained 0.225 to 120.575, and Jun cattle were 0.600 higher to 119.200. The strength on the market stayed in the deferred contract as those posted triple-digit gains. Selling pressure seemed to dry up yesterday and the market posted some follow-through strength today. The cattle market is noT “out-of-the-woods” yet but seems to be building a bottom. Cash trade stayed quiet again for Tuesday, with no bids established. The Fed Cattle Exchange will start the cash trade tomorrow, and most trade will likely hold off until the end of the week. Expectations are for steady to higher cash over last week. The retail markets help bring some buying support this afternoon. Choice carcasses were 1.38 higher to 277.55, and select gained 1.30 to 270.43. Light to moderate load count at 56 loads, should help support the packer margins and cash trade. Feeder cattle fought off session weakness to finish mixed, mostly higher. Apr feeders slipped 0.150 to 137.575, but May feeders gained 0.300 to 142.775. Like live cattle, deferred feeders picked up triple-digit gains on Tuesday. The cattle market may be starting the bottoming process but will need further fundamental support to push prices higher. The market will get a look at some fundamental news with the USDA Cold Storage report on Thursday and the Cattle on Feed report on Friday.

LEAN HOG HIGHLIGHTS: Hog futures saw follow-through buying strength as front-month contracts pushed higher with triple-digit gains. May hogs gained 2.425 to 108.075 and Jun futures finished 2.025 higher to 106.350. The correction of last week’s sell-off might be building some upward momentum, being led by the strong fundamental base in the hog market. The hog strength comes from the retail demand, as carcass values remain strong, despite being softer at midday today. Carcasses were 0.25 lower, but still trading at a historical high of 113.83. The load count was good at 221 loads at midday. Retail values will be looking toward the Cold Storage report on Thursday afternoon, which should show good product movement overall. The cash market stays supportive as the Lean Hog Index gained 0.52 to 103.76, maintaining its upward trend. The hog market is keeping a close eye on Chinese hog markets and their demand. Chinese hog prices are starting to trend higher, which should keep them active in the U.S. pork market. The technical picture is improved with today’s close and could bring additional money flow into the buy-side of the market.

Top Farmer Midday Update 04-20-2021

CORN

  1. May up 15 @ 6.07 & Dec up 9 @ 5.29
  2. Contract highs today – May high of 6.11 & Dec high of 5.33
  3. Limited rain expected for driest areas of Brazil’s corn belt for 2 weeks
  4. US basis continues to surge as buyers keep searching for corn
  5. Ethanol prices moving higher again
  6. Widespread freeze in Midwest & S. Plains
  7. Daily export sales of 114K mt to Mexico
  8. O/I: Lost 30,460 positions in May futures

SOYBEANS

  1. May up 23 @ 14.73 & Nov up 17 @ 13.01
  2. Contract highs: May 14.85 & Nov 13.08
  3. Highest prices today see in over 8 years
  4. US soybeans still not competitive with Brazil until fall
  5. Domestic demand continues to squeeze US soy
  6. O/I: Lost 4755 positions in May futures

WHEAT

  1. May up 14 @ 6.66, KC May up 14 @ 6.26, MNPLS May up 14 @ 6.25
  2. Contract high: MNPLS May @ 6.82-3/4
  3. Ukraine & Russia tensions tighten
  4. Winter wheat conditions virtually unchanged at 53% good/excellent
  5. Dryness in UK, France, and Germany lends support
  6. Dryness & cold in the Plains still bullish this week
  7. O/I: Lost 6373 positions in May wheat & lost 2247 positions in KC May wheat

CATTLE

  1. June LC up 1.12 @ 119.72 & May FC up 0.77 @ 143.25
  2. Cattle rebounded a $1.00 of lows yesterday and market buying still today
  3. Boxed beef prices closed higher again yesterday
  4. Today’s slaughter est. at 119K head
  5. Cash trade expected to stay steady around 120-121
  6. Cash index for April for 16, down 1.55 @ 140.13
  7. Open interest lost 3314 for Jun futures & lost 799 for May FC

HOGS

  1. Jun hogs up 1.32 @ 105.65 & Jun Pork Cutouts up 1.52 @ 113.15
  2. Cash and cutouts continue to trend higher
  3. Strong demand still needs to be met – futures seemingly have no top yet
  4. Hog slaughter estimated at 491K head
  5. Cash lean index for April 15; up 0.21 @ 103.24
  6. O/I: Lost 134 for Jun hogs & Jun pork cutout lost 3 positions

Top Farmer Closing Commentary 04-19-2021

CORN HIGHLIGHTS: Corn futures fished firmer with May closing 6-1/2 cents firmer at 5.92 and new crop Dec up 8-0 at 5.20-1/4. Dec futures has now gained over 70 cents since March 31, establishing another new contract high close. A positive Acreage and Stocks report along with smaller carryout projected on the April Supply and Demand report are all in part responsible for the undercurrent of demand. Friday’s Commitment of Traders report indicated managed money long over 400,000 contracts, closing in on the all-time high of over 429,000 in 2010. Also providing support was a weaker U.S. dollar. The market has gained momentum and the cool weather this week will keep planting off to a less than ideal or fast start for the 2021 season. We do not think that is a huge variable currently but nonetheless something that is supportive. Talk continues to circulate that China may be purchasing more corn and ultimately could be stockpiling corn or at least buying ahead of U.S. summer weather to secure enough inventory in case of adverse growing conditions. Export inspections at 60 million bushels were termed neutral. Year-to-date 57.8% of anticipated export sales have been inspected. A pace that is not concerning to us.

SOYBEAN HIGHLIGHTS: Soybean futures had an impressive day with double-digit gains on new and old crops as old crop futures led today’s rally. May futures gained 16-1/4 cents closing at 14.49-3/4 a new contract high close. Nov also reached a new high close for the year gaining 10 cents finishing the day at 12.84, closing in on our technical objective of 13.00. Another drop in the U.S. dollar, which has now closed at its lowest point since early March, and strength in soymeal provided underlying support. Technical buying and short-covering were noted as well. Internal prices in Brazil have reached their highest level since January causing many to speculate that current crop estimates are overstated. Reluctant farmer selling and continued talk that farmers are defaulting on sales are also providing underlying support. This brings our attention back to carry out at 120 mb bushels. There are many who believe this figure is not low enough. It is highly unlikely that farmers are holding much inventory and if exports or usage remain strong it may take higher prices to pull inventory from the hands of those who have it. Export inspections at 6.8 million, while not large, continued to suggest it is unlikely sales will be canceled. Year-to-date indicates 88.6% of projected sales have now been inspected. Slowing palm oil production is also suggesting more demand for alternatives of which soybean oil fills the void.

WHEAT HIGHLIGHTS: May Chi wheat up 1/4 cent closing at 6.52-1/4 and Jul Chi down 1-1/4 cent at 6.53-3/4. May KC wheat up 2-3/4 cents closing at 6.12, while KC Jul closed up 2-1/2 cent at 6.18 3/4. The morning wheat traded positively – although backed off at the close KC & MNPLS wheat put in contract highs today. As new crop corn put in contract highs – the bullish overflow from corn & soybeans was well received by wheat. Followed by follow-through support from last week on concerns of dry weather and return of frigid temps. Snow is falling across Nebraska to South Dakota accompanied by sub-freezing temps. There are fears that this cold front will be even more severe than currently forecasted, leaving winter wheat in limbo. By week’s end, temps should be back to normal for most of the wheat country and the Midwest. Crop conditions globally still stay relatively in good shape. There are concerns that the cold has recently done in the EU, Russia, and Ukraine crops still favorable, however, the political climate in those countries continue to keep the wheat market skeptical. Weekly grain exports were favorable and above trade expectations at 613, 595 mt.

CATTLE HIGHLIGHTS: Cattle futures finished lower for the seventh consecutive day but may be starting to show some signs of a low. April cattle lost 0.500 to 120.350, and June cattle were 0.575 lower to 118.600. The market did seem to have sellers dry up after the session lows but building a bottom will likely be a process. The market has moved quickly from over-bought to over-sold, and technical indicators are looking to turn friendlier. It will still take a stronger cash market in order to complete the turn. The cash market was a typical quiet Monday, and any trade will likely get started on Wednesday or later. The retail beef carcass value is the strength of the market. On Friday’s close, choice carcasses traded at $276.62, over $56.00 above the 5-year average. This should help the cash market, but bids have been elusive. At midday today, choice carcasses were softer, down 0.23 to 275.82, but select was 1.58 higher to 270.68, on light to moderate demand of 52 loads. Some positive news on the export front has been the reduction of beef tariffs by Japan. On Friday, a 30-day window of raised tariffs on U.S. beef of 38.5% came to an end, dropping back to 25%. The raised tariffs came in response to Japan hitting an import quota, and this protection kicked in. After a 30-day period, tariff rates went back to previous levels, and that time frame ended on Friday. The market will be watching export sales in the future to see if Japanese buying picks back up at the lower tariff rates. The feeder cattle market stayed pressured, with triple-digit losses again today. April feeders dropped 1.900 to 137.725, and May feeders fell 1.250 to 142.275. Another strong day in the grain markets limited the feeder market, but prices did finish off intraday lows.

LEAN HOG HIGHLIGHTS: Hog futures saw the buyer return today and posted strong gains. The new front-month May hogs are lightly traded but gained 3.175 to 105.650, and June hogs were 2.625 higher to 104.325. June is the most actively traded contract and the focus of the market. Even though the market trade was strongly higher, prices stayed within the trading range of Friday’s strong trade lower. The key will be follow-through as the week works on. The fundamentals are staying strong, and demand has stayed aggressive. Global hog supplies are at a 45-year low, and the demand for pork and products are going to stay supported. Carcass value was higher at midday today, gaining 2.61 to 114.70 on moderate demand at 162 loads. This trend supports the cash market, which is still trading at multi-year highs. The Lean Hog Index stays firm, gaining 0.21 to 103.24. Last week was the 12th consecutive week the index has trended higher, and the cash market maintains that strength. The technical side of the market was extremely weak after Friday’s close, but some technical indicators are starting to turn friendlier after today’s strength. The market is building a potential bottom, with the $100 level as support under the June contracts. The next few trading session will be a key to see that the market has turned.

Top Farmer Midday Update 04-19-2021

CORN

  1. May up 6 @ 5.91 & Dec up 7 @ 5.19
  2. Weekly grain export inspections 1.524M mt
  3. Still mixed concerns over Safrinha corn as rain not expected until end of week
  4. New crop corn surges to high of 5.20
  5. Argentina expected to get rains which will further delay harvest
  6. Ethanol prices continue to rise with profitable margins
  7. Funds reported 402K contracts long
  8. O/I: Lost 30,123 positions in May futures

SOYBEANS

  1. May up 12 @ 14.45 & Nov up 9 @ 12.83
  2. Weekly grain export inspections 183,969 mt
  3. Brazil rainfall expected to be erratic & light than usual for centeral/south Brazil
  4. Veg oil prices strength continue to push soybeans higher
  5. Mato Grosso now 100% harvested – expected 35.7 mmt (record crop)
  6. O/I: Lost 7,692 positions in May futures

WHEAT

  1. May up 3 @ 6.56, KC May up 6 @ 6.15, May MPLS up 2 @ 6.66
  2. KC and MPLS wheat headed for 5th consecutive day higher
  3. Weekly grain export inspections 613,595 – above trade expectations
  4. Cold weather in US central Plains will bring frost/freeze to many winter wheat areas
  5. Plains and northern Plains still remain in drought
  6. Still concerns over recent frost/freezes in Europe have left more damage behind to crops
  7. O/I: Lost 3,214 positions in May wheat & lost 3,742 positions in KC May wheat

CATTLE

  1. Jun LC down 1.10 @ 118.07 & May FC down 2.27 @ 141.45
  2. Despite strong demand, cattle trading down for the 8th day in a row
  3. Market appears oversold – boxed beef prices very strong last week
  4. Today’s slaughter est. at 118K head
  5. Cash bulk of cash trade last week was $121 – nothing today yet
  6. Cash index for April for 15; down 0.62 @ 141.68
  7. Open interest lost 357 for June futures & lost 738 for May FC

HOGS

  1. Jun hogs up 2.37 @ 104.02 & Jun pork cutout up 1.60 @ 111.00
  2. Packers paying higher prices looking for market-ready hogs
  3. Hog carcass value at 112.09 – almost 50% above a year ago
  4. Hog slaughter estimated at 489K head
  5. Cash lean index for April 14; up 0.33 @ 103.03
  6. O/I: Lost 3,254 for Jun hogs & Jun pork cutout lost/gained 0 positions

Top Farmer Closing Commentary 4-16-21

CORN HIGHLIGHTS: Corn futures ended the week on a soft note as May futures lost 4-1/2 cents on the session closing at 5.85-1/2 but gained 8-1/4 cents for the week. December closed unchanged today at 5.12-1/4 gaining 15-1/4 cents for the week. Traders may have taken advantage of this week’s test of 6.00 by exiting longs or establishing shorts. We also believe that farmer selling picked up and elevators were likely hedging their newly acquired corn. This week’s lack luster corn export sales along with increased chances of rain is parts of Brazil had prices on the defensive since mid-week. Planting progress will pick up steam in the days and weeks ahead with no appreciable expectations for widespread delays. In short, the market ran out of friendly news late in the week and gave back some early gains. Traders were also likely buying soybeans and selling corn with some supportive news supporting soybeans and a lack of new hindering corn futures. Nonetheless, the uptrend is intact, basis strong, and cold weather in the 6–10-day outlook limits strong planting progress.

SOYBEAN HIGHLIGHTS: Soybean futures firmed today closing 15 cents higher in May at 14.33-1/4 and November gaining 5 cents ending the session at 12.74. Tight supplies of old crop soybeans, positive export news this week and soybean oil challenging contract highs on renewed concerns regarding world vegetable oil were viewed as supportive this week. Palm and canola oil prices continue to rise pulling soybean oil futures higher. The March crush figure released this week was the second highest March on record. Record high demand was also noted from September through March at 3.369 billion bushels. The soybean market continues to trade in a sideways pattern, but this week’s strong finish provides new life. The fundamental focus is on world inventories which on April 9th (the most recent USDA report) were lowered by several million metric tons. Keeping prices in check, especially since January, is concern over resurgence of African swine fever in China. Yet, the world hog population in 2020 was its lowest in over 40 years. Expectations of increased hog production worldwide, especially in China despite some recent outbreaks of ASF, suggest demand will continue to remain strong. Bottom line, no room for error on this year’s crop.

WHEAT HIGHLIGHTS: May Chi wheat down 1 1/4 cents, closing at 652 1/2 and July Chi down 1/2 cent at 6.55. May KC wheat up 1 1/2 cents, closing at 6.09 1/4, while KC July closed up 1 cent at 6.16 1/4. Although wheat made gains for the week, today was a choppy trade day, with all markets closing virtually where they opened. The market paid little attention to the rains falling in Kansas, Oklahoma, and Missouri today. The drought in the northern Plains, combined with recent cold temps, continue to dominate the market in what most would’ve thought to be a bearish trade day if trading weather alone. However, that leads us the point that wheat is not only trading weather, ongoing tensions between Ukraine and Russia keeps traders nervous, as Russian troops build at the border.  If a conflict were to ensure the idea that this would limit Black Sea export/imports would not be a stretch of the imagination which could have a big impact on many markets – but specifically wheat being one of them. Also support futures this week is Paris milling futures continuing to climb, putting in contract highs today – again, recent cold weather in EU has traders & producers alike weary of crop damage and production loss.  Of course there is still a bearish side to the wheat market. Russian, Ukraine, Australian wheat all appear to be doing great from a conditions standpoint. No adjustment to production has changed the fact that a record production number is being projected for the 2021-22 growing season – and no massive new demand has erupted yet to eat through it. This is ultimately why we respect the bullish elements of the wheat market, we suggest continuing to protect price levels either through selling or hedging.

CATTLE HIGHLIGHTS: Cattle futures finished lower again today as selling pressure stayed in the livestock complex, lead by technical selling in the hog markets again today. April cattle lost .750 to 120.850, and June Cattle were .475 lower to 116.175. This ended a difficult week for Live cattle as the April contract was 2.575 lower, while June dropped 3.400. Cattle futures still stayed pressure, but more consolidative in Friday’s trade. June cattle stayed within Friday’s range, possibly signaling a slowing to the selling pressure. This move lower has been triggered by technical selling and liquidation of long positions. In addition, a strong move higher in grain markets saw profit taking hit the Feeder market, adding to the pressure. Fundamentally, the market stays support, lead by a strong demand tone. Retail beef carcasses trended higher this week, and Choice was trading .32 higher to 276.94, and Select was .70 higher to 269.13 at midday. Load count was light to moderate at 61 loads. At midday, choice carcasses were trading over $4.50 that last Friday’s close. The disappointment this week came in the cash market. Cash trade stayed relative quiet this week, as packers held back on bids. Some light trade occurred with $120-121 in the South and $123-124 in the North, both were steady to lightly higher than last week. The market will likely anticipate more cash strength next week with retail carcasses strong and estimate packer margins pushing the $600/head levels. Estimated slaughter today was at 113,000 head, slightly above last week, but for the week, cattle slaughter is trending under last week’s numbers. That tighter supply with strong demand should help support the market. The grain market had strong selling pressure triggered in the Feeder market as grain prices rally this week. On Friday, April feeders were .425 lower to 139.625, and May feeders dropped .700 to 143.725. It was a difficult week for feeders as April lost 5.125, and May was down 5.900. The cattle market, overall has quickly work off an over-bought condition, and may start looking like a value, especially given the strength in demand.

LEAN HOG HIGHLIGHTS: Hog futures saw continued strong selling pressure as more long liquidation and profit taking pushed the market strongly lower. June hogs were 3.000 lower to 101.700, and July hogs lost 2.675 to 99.700, and closing back under the 100.00 level. For the week, June hogs dropped 7.250, and July was 7.100 lower. The hog market was battle between fundamentals and technicals, and the technical picture won the recent trade. June hog futures filled the March 26 price gap and pushed lower to challenge the $100 level before finding some footing. The market has quickly moved of the over-bought status, and given the fundamental, may start looking like a value. The cash hog market is still extremely strong. The Lena hog Index finished .33 higher today to 103.03, completing the 12th consecutive week higher for the index. Since the start of the year, the index is trading up 70% and at its highest levels since 2014. With April off the books, May is trading at a .550 discount to the index. The pulling of this premium out of the market with April expiration may have been a big factor in the push lower. Pork demand stay strong. Pork carcasses were softer at midday, losing .68 to 112.69. Movement was light to moderate at 162 loads. Pork carcasses have stayed steady to higher this week, as pork demand stays aggressive overall. Total hog slaughter for the year is trending 3.4% under last year, reflecting the tighter supply of hogs. That tighter supply, in combination with demand strength has brought the performance to the hog market overall.

Top Farmer Midday Update 4-16-21

CORN

  1. May down 4 @ 5.85 & Dec down 1 @ 5.11
  2. Prices mixed today but over a nice finish for the week
  3. Brazil corn still at risk
  4. Slow start the US growing season in focus
  5. Ethanol margins should remains stable as more drivers hit the road
  6. Tight supplies & demand continue to keep prices strong
  7. O/I: Lost 34,877 positions in May futures

SOYBEANS

  1. May up 8 @ 14.26 & Nov up 5 @ 12.74
  2. Bean meal & oil helping support prices today
  3. NOPA crush little short of expectations however still strong numbers
  4. S. American harvest continuing – Argentina stable short-term
  5. Nov making valiant effort to challenge high of $12.85 – up to 12.82 today
  6. O/I: Lost 10,219 positions in May futures

WHEAT

  1. May down 4 @ 6.49, May KC down 1 @ 6.06, May MNPLS up 1 @ 6.64
  2. Concerns over US cold & dry weather offsetting rains in the plains for now
  3. Dollar continues to falter – low today so far 91.48
  4. Paris milling futures put in another contract high today
  5. Tensions still rise in Russia/Ukraine – need close monitoring in the next week
  6. O/I: Lost 10,696 positions in May wheat & lost 4839 positions in KC May wheat

CATTLE

  1. June LC up .10 @ 119.75 & May FC down .17 @ 144.25
  2. Cash cattle traded higher – packers still need cattle and willing to pay for it
  3. Boxed beef indicates demand remains strong
  4. Today’s slaughter est. at 114K head
  5. Cash trade late Wednesday at $121 – expected higher next week
  6. Cash index for April 14; @ 142.30
  7. Open interest lost 1,061 for June futures & lost 298 for May FC

HOGS

  1. June Hogs down 1.17 @ 103.50 & June pork cutout up .17 ! 11.60
  2. Cash hogs higher with port cutouts very strong
  3. Marketing year low exports still sending shock through futures
  4. Hog slaughter estimated at 480K head
  5. Cash lean index for April 13; up .32 @ 102.70
  6. O/I: Gained 95 for June hogs & June pork cutout lost 4 positions

Top Farmer Closing Commentary 4-15-21

CORN HIGHLIGHTS: Corn futures finished mixed after breaking the 6.00 mark for the first time in seven years. May reached a high of 6.01-1/2 before closing 4 cents lower at 5.90 posting a hook reversal. New crop December closed 1 higher at 5.12-1/4 after reaching a new contract high of 5.17. Export sales at 12.9 million were considerably weak as today’s figure was considerably lower than in previous weeks, yet this brings the year to-date total to 2.630bb. The most recent forecast from the USDA is 2.675 bb. With today’s sales figure, 98.3% of the yearly expectation is now met. The key will be how much is shipped and if there are any cancellations. The most recent 90-day forecast calls for above normal temperature and below normal precipitation in the western corn-belt. This area is already dry with low subsoil conditions a continual concern. Tensions between the United States and China are on the rise and this is concerning. With new highs established farmer selling likely picked up at the 6.00 area, as did speculators taking exiting long positions. This may have, in part, influence the inability of May futures to hold solid gains from early in the morning session. Most likely commercial forms bought an influx of corn sold by farmers and in turn were hedging the board.

SOYBEAN HIGHLIGHTS: Soybean futures finished with solid gains of 5 to 9-1/4 cents as August futures lead today’s gainers closing at 13.72-1/2. Nearby May gained 8-1/4 closing at 14.18-1/4 and November up 5 at 12.69. The NOPA crush report was favorable with 177.984 mb crushed in March, the second highest March on record. Demand continues to underpin prices as does tight inventory. Today’s export sales, while small at 3.3 mb, it nonetheless was positive. This spring’s total export sales to date two 2.233 billion. The most recent USDA estimate is for a yearly total sale of 2.280 billion. 97.9% of projected sales are on the books. As mentioned in the corn report the key is for inspections to remain strong in leave little room for export sales cancellations. Tight inventory oh soybean suggest that price setbacks will likely be met with little to no farmers selling. Therefore, while prices are at a high level, they are also rangebound. Brazil will have a record crop and their beans will compete on the export market with the remaining US crop. The us dollar lost ground again today.

WHEAT HIGHLIGHTS: May Chi wheat up 5 3/4 cents closing at 6.53 3/4 and July Chi up 5 1/4 cents at 6.55 1/2. May KC wheat up 4 1/4 cents closing at 6.07 3/4, while KC July closed up 3 ¾ cents at 6.15 1/4. Weather continues to be a driving force in the wheat market today, freezing temps have hit winter-wheat growing areas of the Midwest. Temps down to the freezing overnight over the northern plains pose a potential threat to current crop.  More precipitation is expected in the southwest plains through tomorrow – however the forecast turns gravely drier for the rest of the plains for the next 2 weeks minimally. Wheat exports were anything but exciting today, coming in at 56,600 mt. Paris milling futures were higher again today, they too are nervous about effects of recent cold weather on current crop health. Weak exports, global productions numbers, globally wheat is rated very well in Black Sea region & Australia – how is wheat moving higher? So far for this week at least, cold weather in plains followed by more drought like conditions, a rally in corn, and tensions in Russia & Ukraine appear to be keeping wheat supported for now.

CATTLE HIGHLIGHTS: Cattle futures finished lower again today .The April contract, down five consecutive days, lost .500 to 121.600 and June cattle, down for six consecutive days, lost .400 to 119.650. Price are challenging the bottom of the trading range, and the June contact is challenging the reversal on the charts from March 18. The cash market started to develop today, but was still slow overall. Texas and Kansas saw cash trade at $120, $121 respectively, steady to slightly higher than last week. Norther trade has stayed quiet overall. Producers are still holding out the prospects for improved bids going into the end of the week. Producer resiliency may be supported by good retail strength. At midday, Choice carcasses gained an additional 3.92 to 276.83, and Select was 1.56 higher to 268.67. Light to moderate movement at 54 loads. Some additional caution may have come into the markets today after this morning’s exports sales numbers. New weekly sales were at 15,700 MT, down 14% from last week and 23% below the 4-week Average. Shipments were supportive at 19,000 MT, up slightly from last week. Japan, China and South Korea were last week’s top buyers of beef. Cattle slaughter has been trending lower this week, with estimated slaughter today at 114,000 head, down 5,000 from last week. Estimated slaughter was trending about 7,000 head lower than last week’s totals. The tighter supply and the thought of packers being short-bought should help support the cash market going into the end of the week and next week, as long as carcass values stay strong. The Feeder market stayed weak, adding to the selling pressure in the complex. April feeders dropped 1.100 to 140.050, and May feeders fell 1.000 to 144.425. Moderate strength in grain markets and technical selling has pushed feeders lower. The cash feeder index is trading at 142.30, down 1.26 today, but at a premium to the April futures, this could limit losses. The market has moved from over-bought to a over sold position very quickly. The bottom may be near, but the long liquidation is still in front of the market, unless the strong fundamentals can help turn the corner.

LEAN HOG HIGHLIGHTS: Hog futures finished sharply lower with a majority of contracts pushing limit down today. Aril hogs end their trading life tomorrow, finished .200 to 103.400, but June hogs finished the 3.000 limit lower to 104.700. The market was trying to recover from the recent push lower, but a week of poor export sales helped break the market lower today. USDA reported weekly export sales last week at 17,200 MT, a marketing year low and down 48% from last week. Mexico was the largest buyer for the week. Keep in mind the markets were dealing with Easter week for those sales, and China was on Holiday. Export shipments were still supportive at 38,600 MT, unchanged from last week. Despite the soft week, the U.S. outstanding sales are still extremely strong, and demand for U.S. pork internationally still stays strong. Those factors were still reflective in the daily fundamentals. Cash market and Lena hog Index stay firm. The Lean hog index gained .32 to 102.70, narrowing its gap to the April futures. Carcass values were higher at midday. Pork carcasses gained 4.83 to 114.92 with good movement at 162 loads. The rib and the belly cuts were strong supporting carcass values this afternoon. Those fundamental factors should support the market, but the breakdown technically brought in the additional selling. Prices will likely work lower into the start of the session tomorrow, as June may be targeting the price gap at 103.550 from March 26. The hog market was strongly over-bought going into this weakness, and the long liquidation may continue until prices look like a value overall.