Grain and livestock futures trade higher early.
Brad Kooima, Kooima Kooima Varilek, says the nearby live cattle futures made new highs for the move Friday and open again Monday.
He says the futures have been pushed by last week’s sharply higher cash in the North at mostly $196, the South was at $191.
Choice cutouts have also been moving higher a signal of strong demand.
However, the futures will need continued bullish news to keep making new highs.
He says cash could be steady to even slightly higher again this week as packers are still looking for inventory and are slaughtering last week’s purchases already this week.
Feeder cattle futures recover early as APHIS says the Mexican border will not reopen to imports of feeder cattle until 2025 and then shipments will be incremental.
However, there may also be some positioning ahead of the Cattle on Feed Report Friday.
Lean hog futures see early strength with the Lean Hog Index nearly steady at $83.90 and as cutouts bounced $2.30 on Friday but the funds have shed some of their record long length.
Kooima thinks they stay long unless the futures take out last week’s lows or the 50 day moving average on the charts.
Grains try to hold early gains.
Corn has the tailwind of 200 million bu. less supply but the funds added nearly 78,000 contracts to their long position as of last Tuesday and have not been able to take out chart resistance.
Kooima says soybeans are going to struggle with the large South American crop and rains received over the weekend in parts of Brazil.
After the first of the year if the South American crop confirms the soybeans may have to check out the contract lows again, according to Kooima.
He says unfortunately that could be an anchor for corn.
