Grains are mostly lower on Tuesday morning, livestock mostly higher.
Soybeans Pause on Farmer Pricing
Jamie Gieseke with Paradigm Futures says soybeans are seeing some profit taking after a 35 cents rally off of last week’s lows but also some farmer pricing.
He says many farmers have to price November basis contracts as futures expiration nears and so soybeans are seeing some pressure.
Basis and processor bids have improved in the last week as harvest starts to wind down and so there are some better pricing opportunities according to Gieseke.
Soybean Charts Look Good After Pricing in China Optimism
Yesterday’s close of the November contract above $10.30 was constructive according to Gieseke and has been a result of growing optimism about a trade deal with China at the end of this month when the Presidents meet in South Korea.
So, to keep the market moving higher Gieseke says the market will need to see some proof of soybeans sales to China to thaw their boycott of U.S. product.
Corn and Wheat Fall Together
After closing higher for five days riding the coat tails of the soybean market, corn is trading slightly lower on Tuesday morning with wheat.
Gieseke says the wheat market is reacting to another increase in Russian wheat production by IKAR and that is spilling over into the corn market.
Both grains are also seeing some pressure from strength in the U.S. dollar index.
December corn is also nearing chart resistance in the $4.25 area causing some profit taking he says.
Cattle Futures Continue to Recover
Live and feeder cattle futures are in the green to start Tuesday as the market continues to recover after the melt down on Friday in response to President Trump’s talk of a plan to lower beef prices.
Sunday night President Trump also said the U.S. was looking at purchasing more Argentina beef to help out.
Gieseke says the market has absorbed that news and barring the U.S. opening the Mexican border to feeder cattle imports or lowering Brazilian tariffs on beef imports the market has digested that news.
It is now back focusing on last week’s higher fed cash trade with the 5-Area Weighted Average steer price at $239.82.
Cash feeder cattle at auctions are also still running red hot and the cash index was up $1.41 at $376.51 on its last print.
Lean Hogs Try to Find Support
Lean hog futures are trying to recover as well after the December contract held support at $82.00 on Monday.
The market has been down for nearly 15 sessions and is oversold and due for some short covering says Gieseke.
