Grains are seeing some profit taking after hitting chart resistance and with pressure from the announcement of additional China tariffs.
The Biden Administration has announced $18 billion of import tariffs on goods like electric vehicles, semi-conductors, medical supplies, steel and aluminum. Ag products were not on the list but there is concern about retaliation according to Kent Beadle, Paradigm Futures. Additionally, he says used cooking oil was not on the tariff list after rumors it would be and that has tanked soybean oil prices.
Conab also raised corn and soybean production in Brazil by expanding acreage to offset yield cuts. The agency put corn production at 111.6 million metric tons and soybean production at 147.7 mmt, which is up about 1.2 mmt from their last estimate.
Corn is holding up better than soybeans due to planting delays in the U.S. as progress is now at 49%, which is behind the 55% five-year average. Mexico also announced a flash sale of 15.9 milllion bushels of U.S. corn, with 5.3 mb of the total old crop.
Wheat futures are consolidating and are due for a correction after a rally tied to global production concerns, especially in the Black Sea and Russia due to drought and frost. The winter wheat crop was rated at 50% good to excellent yesterday, which is unchanged from a week ago.
Cattle and hogs both bounce on short covering, the pullback in feed prices and higher product values. Boxed beef was $4.38 higher on the choice category yesterday and approaching the $300 mark, while pork cutouts are now above $100.
Live cattle are also garnering support with the futures at a discount to the cash trade.
