Grains are mixed early in the session and after a higher opening livestock have turned mixed as well.
After closing higher on Thursday following cuts to Brazil’s soybean crop the soybean and soybean meal market are seeing profit taking and pressure from forecasted Argentina rains. Mike Minor, Professional Ag Marketing, also says the market is concerned about the USDA’s cut in soybean exports and that there might be more cuts in the future as South America’s crop undercuts the U.S. Minor thinks this week’s lows around $11.79 to $11.80 are vulnerable and could result in the market dropping down to the May lows of 2023 at around $11.45 3/4. “The market has dropped over $2.00 and I just don’t see a reason for it to stop,” he says.
Corn is following wheat which is seeing short covering and short profit taking by the funds after a sell off on Thursday. Corn has continued to grind into new contract lows and Minor says the funds will continue to sell on any strength because there is nothing bullish enough to get them to cover their short position.
Live and feeder cattle started higher and once again made new highs for the move, then saw some profit taking. The market is awaiting cash trade which was at $179 on light basis in Iowa yesterday. This is well below where the futures are trading so the market is waiting for the cash to catch up.
Lean hogs have seen a sizable correction from the recent highs on profit taking and the sliding cutouts but are finally bouncing Friday with a $2.37 recovery in cutouts. The question is if its sustainable or not? Minor says that will depend on the cash and cutout trends.
