Corn, soybeans and cattle ended lower on Thursday, with wheat and hogs higher.
Jeff Hoogendoorn, Professional Ag Marketing, says corn, soybeans and cattle all saw corrective selling on Thursday.
Is the bull run in these markets nearing the end or is this just profit taking end of month?
He says corn still has several bullish fundamental factors that pushed the market to new 15 month highs on Wednesday.
Those include tighter ending stocks, dry weather in Argentina and wet weather in Central Brazil which is causing a delay in second crop safrihna corn planting, plus the funds are long over 300,000 contracts.
However, the market has had a nearly $1.50 run off the contract lows from August and may be due for some profit taking, especially as its end of month.
The sign of a bull market is these past profit taking rounds have been met with buying interest.
And he says the market is not indicating corn prices have gotten high enough to force demand destruction.
“If I start seeing corn exports slow way down that would be a sign to me that the market may be nearing a top, but so far that hasn’t been the case,” he says.
While lower on Thursday on corrective selling, the soybean market has recently rallied well off the contract lows set in December, despite all of the bearish talk about tariffs and a record Brazil soybean crop.
Hoogendoorn says corn has been providing some support to soybeans and traders put some weather premium in soybeans and meal due to the dryness in Argentina.
Plus, there is already talk of less acres of soybeans and more corn being planted in 2025.
Unlike corn, soybeans have been unable to take out overhead chart resistance at the 200 day moving average and so that may be limit upside for a while.
Cattle futures are seeing some consolidation off of record highs earlier this week.
Yet, Hoogendoorn says the market should be well supported on breaks as long as cash and the cutout values can remain strong.
Cash has been at record levels with beef values not yet showing signs of demand destruction.
Lean hog futures ended higher Thursday and have been seeing support from tighter supplies, especially compared to USDA’s expectations.
Some of it is due to disease problems and that is showing up in the summer months with those contracts over $100.
Hoogendoorn says he has also been impressed with how well the hog market has handled possible tariffs on Mexico and Canada slated for Feb. 1.
