Grains and cattle are leaning higher early Friday, hogs lower.
Scott Varilek, Kooima Koomia Varilek, says cattle were down hard Thursday following lower cash at $185 and with lower cutouts.
Varilek is concerned that producers are losing their leverage especially with the higher carcass weights.
He says technically Feb live cattle have held Monday’s lows but are teetering around the 100 day moving average and so that needs to hold to stop the fall.
Lean hog futures are rolling over with lower cutouts as well and after scoring a technical reversal this week the funds may be ready to exit their record long position.
Grains are trying to recover with some corrective buying.
The market saw massive selling Thursday and took out support in both corn and soybeans and got near contract lows on wheat, so it is due for a correction.
The higher dollar and uncertainty about the second Trump administration has pressured the market this week from talk of tariffs, what happens to biofuels and even what Robert F. Kennedy Jr. at HHS means for the ag complex.
Exports came in below last week with corn at 51.8 million bu., soybeans at 57.2 and wheat at 14 million, but the total commitments are above last year in all categories.
Soybean meal is making new contract lows again and Varilek suggests livestock producers line up feed needs as meal rarely gets below $300/short ton.
Meanwhile, soybean oil is rallying with palm oil which is up 2.5% but also There are news reports China is cancelling the 13% export tax rebate for used cooking oil starting December 1, raising the cost for importing countries.
