Grain and livestock markets see 2-sided trade Thursday morning ahead of month end and USDA data.
The trade is expecting less corn and wheat acres, and higher soybean acreage verses a year ago. Randy Martinson, Martinson Ag, says the fringe areas will be where the shifts come from especially in the northern areas where farmers can plant crops like dry edible beans and canola.
However, quarterly stocks are expected to be higher for all crops compared to a year ago. The amount will likely make the difference in the market reaction. However, it is also end of month and quarter which may also make the moves more exaggerated.
What will the markets trade and focus on after the reports?
Martinson says weather will be the focus the next two months and the trade will be looking to see how quickly the crop gets planted but there are also concerns about dryness in parts of the corn belt, particularly areas like Iowa and the northwestern corn belt. Plus, he says with the prediction of LaNina that could mean a warmer drier growing season for that area.
Markets will also be focused on the crop in South America. Martinson says there needs to be more clarity on the size of the Brazil soybean crop. The current estimates are far apart, and USDA is much higher than Conab and so those need to come together with better agreement. However, Agroconsult did increase their crop forecast Wednesday to 156.5 mmt.
For the month soybeans are up 40-45 cents, with corn steady and wheat down 5 -25 cents. The monthly closes will be important according to Martinson for determining future price direction.
Cattle started off lower but are trying to recover after holding long term support and hopefully digesting the bearish news from the HPAI cases in dairy cattle and the Cattle of Feed report.
Hogs have also been on both sides of steady preparing for the USDA’s Quarterly Hogs and Pigs Report out after the close. Weekly exports for pork were a marketing year high at nearly 56,000 metric tons.
