Grains end lower for a second day, while livestock rally.
Chuck Shelby, Risk Management Commodities, says grains saw technical selling across the complex and also reacted to the strength in the dollar.
Corn and soybeans had a strong rally last week post-election and reached the top end of recent trading ranges.
When prices could not take out chart resistance funds took profits, but there was also a pick up in farmer selling at those levels especially with the last bushels from the 2024 harvest coming to market.
The collapse in soybean oil also weighed on the bean complex as bean oil followed the break in palm oil but the market also reacted negatively to Trump’s EPA Administrator pick Lee Zeldin who was not a biofuels supporter when he served in Congress
Favorable weather and fast planting in South America is also a headwind for soybeans and overriding strong demand.
Earlier today, USDA reported weekly soybean export inspections totaled 2.28 MMT or 83.7 million bu. during the week ended Nov. 7.
Basis levels have been strong for corn and soybeans and bull spreads are working which Shelby says is an indication of strong demand, especially for corn.
Wheat made new lows for the move with technical selling as support areas were taken out, the higher dollar and improved weather in the U.S. and Black Sea.
Cattle futures extended gains after reversals and selling exhaustion on Monday, plus lower corn prices.
Shelby says cattle futures look like they will hold Monday’s lows but he doesn’t expect much upside because seasonally the Thanksgiving holiday meat demand shifts over to turkey and ham.
Lean hog futures made new contract highs as the funds, who are already record long, continue to buy and cash has had a contra seasonal move higher.
However, June hogs are near $100 and so Shelby says producers should be looking at these levels to hedge.
