Corn and wheat futures were higher Tuesday, with soybeans lower. Cattle surged to new highs with hogs lower.
Corn Higher on Short Covering, Follows Wheat
Corn futures closed slightly higher on Tuesday after making new lows for the move overnight.
Vince Boddicker with Farmers Trading Company says corn saw some short covering and spillover buying from the rally in the wheat market.
“We closed below $4.11 on Monday, which wasn’t positive as that was the quarterly stocks report low but we closed back above it today. I’m thinking it’s probably negated that low. And whether we can keep going, we’ll find out. But I think sideways is more what we’re going to be until more of the harvest is done,” he explains.
Corn Holds up Despite Harvest Pressure
Corn futures have actually held up well in light of the fact that USDA is still predicting a record U.S. crop which normally induces some harvest pressure.
However, Boddicker thinks the market has held up well due to lower than expected yields and basis may be signaling that.
“You look at the basis, especially in the Eastern Corn Belt that is narrowing already,” he says.
But he also acknowledges strong end user demand at these value levels is supportive.
Wheat Sees Short Covering
Wheat also saw short covering and technical buying after making new contract lows in both hard red winter and soft red winter wheat classes earlier in the session. The low in Chicago wheat was also a five year low.
Boddicker says the market was oversold and due for a correction plus the weaker dollar may have contributed to the rally.
Soybeans Fade as China Woes Linger
Soybeans ended off lows with spillover from the rally in corn and wheat.
However, early selling was tied to renewed concerns about China trade relations as China put levies on U.S. ships docked in Chinese ports as a retaliatory measure.
Boddicker says the market is still uncertain about the status of trade talks between the two countries but he is doubtful any purchases will come from the meeting between the two leaders at the end of the month.
“But let’s say you did get a deal out of China. These guys got all their beans bought through February. What are we going to do? By that time, South America is back online again. So I’m just not sure you can do much,” he explains.
Brazil Soybean Crop Estimate
Adding to the bearish sentiment in the soybean market was Brazil’s soybean production estimate.
Conab put 2025-26 production at a record 177.64 MMT, which was up 3.6% from last year due to an increase in both acreage and yield. Exports were pegged at 112.11 MMT which means the U.S. will have plenty of competition in the export arena.
What is Holding Soybeans Up With Bearish News?
With such bearish news why did soybeans hold support on Tuesday?
Boddicker thinks some of it was technical buying after January held the $10.15 support area and harvest pressure has eased, “Because harvest is well over 50% done nationwide. I’m guessing you’re probably closer to 65% or 70%.”
Another biggest factor is farmers just aren’t selling soybeans at these low price levels and with harvest wrapping up in many areas they have already put the crop in storage and will ride out the market waiting for better basis and/or futures prices.
“You are seeing people storing beans that usually don’t store beans, period,” he adds.
Cattle Surge to New Highs
Cattle futures were higher for an eighth day and once again made all-time highs in all of the feeder cattle and live cattle contracts.
Boddicker says the catalyst is the cash market with the widely watched Oklahoma City auction prices up sharply on calves and yearlings.
“On Monday of $5 to $20 higher in the feeders and $20 to $40 higher in the calves and the index going up over $4,” he says.
He also thinks there has been some buying in the futures by commercial accounts or packers that have to offset the higher cash prices they paid last week for fed cattle.
Boxed beef values have also moved higher this week and were up $.51 on the Choice cutouts Tuesday at $364.42 which is giving feedlots more resolve to hold out for higher fed cattle prices from packers.
Where Do Lean Hogs Find Chart Support?
Lean hog futures were lower again on Tuesday and made new lows for the move.
Funds have been liquidating their long position with sell signals tied to chart damage.
However, Boddicker says it is also tied to the increasing slaughter numbers, which indicate bigger supplies of pork ahead.
