Grain and livestock futures end mixed Wednesday.
Tommy Grisafi, Advance Trading, says soybeans give back some gains after a three day rally on rains that fell in the Corn Belt adding to the record yield and with some First Notice Day selling and liquidation.
“Its all of that, coming off those big Pro Farmer numbers the beans are out there. Are 52 bushels, 53, 54, 55? How is demand on the backside right? But yes, a nice rain at the end of August after some extreme heat for a couple of days. Folks at Farm Progress said it was a hot one but things are cooling off and so you get a rain at the end of August you’re going to see some pressure on soybeans,” he explains.
Corn tried, but could not build on Tuesday’s key reversal which Grisafi says was disappointing but the volume was also light as the market is going into a big holiday weekend.
Corn also seemed to be drug down by soybeans, lower crude oil and a higher dollar index and old crop pricing ahead of First Notice Day on Friday.
However, Grisafi says the balance sheet for corn is getting a bit tighter.
“There was a point we thought we might have 3 billion bushels of corn carryout you know if we had all the acres planted and the record yield, but that number is getting smaller. Although having a 2 billion bushel carryout is a lot, a few problems in the world and that could tighten up quickly,” he points out.
Meanwhile wheat extended gains for a second day on fund short covering after key reversals scored on Tuesday.
Grisafi says U.S. wheat has also gotten too cheap. “It’s definitely affordable, the price of wheat is one sale.”
He says there are quality issues in the Hard Red Spring wheat in North Dakota that may make high protein wheat supplies tight.
Live cattle consolidated as well after a couple of days with strong chart action with lower boxed beef values serving as a headwind.
