Markets closed higher on Monday except the soybean complex.
Ted Seifried, Zaner Ag Hedge, says soybeans and the products saw significant pressure tied to risk off selling and South American harvest pressure and more favorable weather in Argentina.
China raising tariffs 10% on U.S. soybeans was at least psychologically negative but he says the U.S. won’t see many more sales anyway as China shifts their buying to South America.
However, over the weekend China slapped fresh tariffs on Canadian goods with a 100% levy on canola, which weighed on the soybean oil market as it will lead to more canola exports into the U.S. and canola being crushed in North America.
“I think soybeans might have sold off more though if we weren’t right ahead of the March WASDE,” he says.
Although he is only expecting USDA to make slight cuts to the South American crop.
Wheat saw a short covering rally buy Seifried says it may have been triggered by weather concerns.
The rally in wheat lifted the corn market but export inspections were also strong at 71.6 million bu. which was supportive.
Plus, the corn market is anticipating some friendly news in the WASDE on Tuesday with a slight uptick in exports.
Cattle staged an impressive close with the melt down in the stock market, which traded sharply lower as recessionary concerns are starting to emerge and prompt some money flow out of commodities to safe haven investments..
The futures were supported by last week’s higher cash with the five area weighted average steer price at $200.28, which was up $2.63 from the previous week.
The big question is can the cattle market continue to push higher with the recessionary concerns that are weighing on the stock market.
Lean hogs shook off the negative stock market and China’s 10% tariff on U.S. pork imports to close firm.
However, the futures are into major chart resistance and Seifried isn’t sure what news it will take to get the market to push through these areas.
