Corn and wheat ended mostly higher on Wednesday, with soybeans, cattle and hogs lower.
Craig Turner, grain and oilseed analyst with StoneX, says corn and soft red winter wheat saw corrective buying as it was end of the month and past first notice day for May futures.
He says there was some considerable long liquidation and rolling out of the May contracts prior to the delivery period which weighed on both commodities to start the week but now that pressure has subsided.
Turner thinks the correction in corn went to far and so Wednesday’s action made up most of those losses.
Corn also got some help from value buying by end users and strong demand indicated in the weekly ethanol production report and another 4.7 million bu. flash export sale to unknown destinations announced.
Wheat futures saw short covering in SRW and HRS wheat as the market was oversold after hitting new contract lows in both hard red winter wheat and soft red winter wheat.
The funds are short in all three classes of wheat and saw some short profit taking as it was end of the month in all but hard red winter wheat.
The soybean market saw follow through fund selling after a lower day Tuesday.
Turner says it was tied to renewed concerns about the lack of progress on the trade war with China.
“I think there was hope earlier that a deal could be struck, but recently it looks like the U.S. is more focused on signing trade deals with every country but China. This is a cold war. They have also expressed a strong interest in using less soybean meal in livestock rations to lessen their dependence on soybean imports,” he says.
He says the soybean complex is also trading weather with ideas that more soybeans and more corn may get planted with the current planting pace ahead of average and an open and dry week to start May.
Technically, the soybean market has not done serious damage yet and so he is hopeful support areas can hold.
The correction in soybean oil off new contract highs early this week has also been a drag on soybean prices and that continued on Wednesday.
Funds are taking some profits off the table in soybean oil as it is end of the month.
