Grains close mixed with soybeans extending gains after Monday’s reversal on short covering heading into the WASDE. Shawn Hackett, Hackett Financial Advisors, says funds are short in the soybean complex and decided to take some profits in case Conab or USDA makes any major adjustments in South American production. “I think it’s likely USDA and Conab will cut soybean production for Brazil with continued private estimates lowering the crop size,” he says.
Corn failed to follow higher soybeans, wheat or crude oil. March corn closed below long-term support of $4.40 but at least held the recent contract low. Hackett thinks the low will hold as it’s too early in the season for the market to fall. “We’re just starting to plant the safrinha corn crop in Brazil and we’re not likely to get any adjustments to production in the WASDE or from Conab. So, it’s hard to get excited about the corn market while we’re still planting down there,” he says.
Cattle made new highs for the move on strong fundamentals and fund buying. “The report that we got out last week show that numbers keep falling, we’re not herd rebuilding. So that was a reminder for the funds, who had gotten bearish, that maybe they needed to reown.” However, now that a 50% correction has taken place, he thinks the rally will slow.
