Grains end higher Monday with livestock mostly lower.
John Heinberg, Total Farm Marketing, says grains opened lower on Monday with the Trump administration announcing tariffs of 25% on Canada and Mexico, 10% on China.
However, grains recovered shortly after the opening when news broke that the U.S. would delay tariffs on Mexico for 30 days to allow negotiations.
Heinberg says there was also speculation that the meeting between the U.S. and China was laying the ground work for resumption of a larger trade deal.
That spurred some technical buying after a couple of lower days in the corn market and a lower weekly close last week.
However, corn is still unable to close above $5 on the March contract even with funds long over 350,000 contracts.
Soybeans were better supported with canola oil out of Canada seeing a 25% tariff and that pushed the bean oil market higher on Friday and again Monday.
Heinberg says soybeans were also trading the wet weather in Brazil that is causing harvest delays and trimming yields in the central part of the country.
Yet, March beans have been unable to close above the 200 day moving average.
Wheat followed the rest of the complex but may have its own story brewing.
Cattle futures ended lower on technical selling according to Heinberg as the market looks tired.
It was also trading tariff concerns and the announced reopening of the border the Mexican feeder cattle imports, plus disappointment that the 5 area weighted average steer came in at $209.57, down $1.22 from last week.
Lean hog futures saw the most negative reaction to the tariff news.
Canada and Mexico account for 40% of U.S. pork exports and while the delay in Mexican tariffs was helpful, Canada has put pork on its secondary retaliation list and will face a 25% tariff.
Funds are long in both cattle and hogs and so Heinberg says they are susceptible to further technical selling.
