Corn and wheat end higher adding risk premium and still trading weather concerns in the U.S. and globally, but corn exports were also strong.
Allison Thompson, The Money Farm, says, “On the weather side we are looking for a pretty wet weekend and over the Memorial Day holiday for the Corn Belt. With that we are also days away from hitting some final plant dates for corn. Up here in North Dakota we’re looking at the May 25 and a little farther South its May 31 and that’s what the trade is watching.”
Thompson says that brings up a lot of questions about whether farmers will switch to soybeans are take prevent plant on corn. “Ultimately we won’t know for quite some time but it adds speculation in the marketplace.” With lower acres due to delayed planting that may also mean lower yield.
She says both corn and wheat markets are up challenging chart resistance and encounter farmer selling at those levels especially on old crop corn with the large amount of inventory farmers are still looking to price. “The next point especially for old crop corn is going to be taking out that $4.80 level that is right around where the 200-day moving average is.”
For new crop December corn she says a push above the $5 level would not meet much chart resistance and the market could run for a while.
CH and KC wheat are also up into technical resistance. July CH wheat needs to close above the $7 level.
She adds that these chart points will be a make or break for the funds. So, she thinks the next couple of weeks could be volatile as the markets sort through production issues and watch weather.
Soybeans set back on poor weekly exports and the lack of confirmation on rumored old crop China export business. Additionally, China hasn’t bought any new crop soybeans from the U.S.
Plus, profit taking hit when July soybeans couldn’t take out $12.50 on the charts. She also thinks there are concerns about additional acres of soybeans being shifted from corn with planting delays.
Cattle futures set back after making new highs for the move and on the heels of higher cash with caution ahead of the Cattle on Feed Report. “It doesn’t surprise me to see a little back tracking before a major report. And if this is a real bull market a correction is warranted,” she says.
Southern cash cattle trade developed at mostly $187 live, up $1 from last week and Northern dressed business was $300 - $304, steady to $5 higher than last week.
