Monday’s markets were a mixed bag — with soybeans, cattle and hogs soaring, corn mixed and wheat lower.
Soybeans soared on a combination of bullish China trade news as well as the May WASDE according to Chip Nelliger, Blue Reef Agri-Marketing.
The market received positive news that over the weekend the U.S. and China reached a trade deal in which China eased its tariffs on imports to 10% and the U.S. to 30%.
The May WASDE was also bullish for the soybean market as USDA cut old crop ending stocks for soybeans 25 million bu. to 350 million.
Carryover for 2025-26 was pegged at 295 million bu., which was down 55 million bu. from this year and came in well below trade estimates.
Nellinger says soybeans rallied $.20 to $.27 and closed above some key moving averages including the 200-day and likely have to go above $11 to price in the smaller new crop estimate.
There is still some question though about the tariff considerations USDA used to derive their estimates as Nelliger says USDA likely completed their data set before the weekend trade developments with China.
USDA also provided bullish numbers for the corn market with old crop ending stocks lowered 50 million bu. to 1.42 billion which came from an increase in exports.
New crop carryout was at 1.8 billion bu. which was 220 million bu. lower than the trade guess as USDA raised feed demand 150 million bu and crush by 70 million.
Global corn stocks for 2025-26 were also cut by nearly 10 MMT from the current season which was a friendly surprise and leave little room for error this production season.
All of this was bullish, yet July corn ended lower on the day and new crop was only up $.03, which Nellinger says was disappointing.
He thinks the funds are still liquidating long corn contracts and the lower wheat market, which is at contract lows, is pulling down old crop corn as well.
Nellinger says the new crop reaction was puzzling as he doesn’t think the 181 bu. trendline yield USDA used in the report is realistic, especially with the problems Southern areas of the Corn Belt are having planting the crop.
The WASDE was bearish for wheat, which ended the day scoring new contract lows in both Chicago and Kansas City.
USDA raised winter wheat production by 33 million bushels to 1.38 billion and ending stocks were hiked to 923 million, nearly 80 million above last year.
Cattle futures made new contract highs with feeders up over $6 in reaction to the rally in the financial markets and the news the Mexican border was shut to imports of cattle due to New World Screwworm.
USDA made the announcement on Sunday saying Mexico was not following the protocol for eradication.
