Grain and livestock markets both ended mixed Tuesday.
Matt Bennett, AgMarket.Net, says wheat was up for a third day continuing to see short covering by managed money traders and adding war premium.
He says the market has been immune to the conflict in the Black Sea but tensions have escalated to the point the trade is taking note.
Corn could not follow wheat with lower soybeans and the failure to get above chart resistance on the December contract just under $4.35.
Bennett says the factors holding the corn market back from seeing a more significant rally include the bearish fundamentals in the soybean market and the 1.95 billion bushel carryout.
He says what’s been interesting is funds have added to their long positions in corn buying around 100,000 positions, cash basis levels have been strong and there has been bull spreading tied to solid demand.
“There is still that tight fisted mindset among farmers that is evident in spreads and basis,” he adds.
Soybeans set back Tuesday on lower product values, forecasted rains in key growing areas of Brazil and a larger crops estimate with Abiove at a record 167.7 mmt.
“They continue to plant more soybeans and its something that’s probably not going to stop any time soon,” he says.
Bennett says even with some dryness in Argentina the soybean market faces a headwind with big global supplies from South America on top of the 470 million bushel carryout in the U.S.
Live and feeder cattle futures had a strong technical day closing back above key moving averages.
Feeders are still the leaders on strong demand and cash feeder prices plus the cash index climbed $1.27 to $252.31.
However, Bennett is still cautious and suggests risk management.
“The thing that concerns me is funds have been long forever and we’re not expecting a bullish Cattle on Feed Report this week with placement estimates around 104%,” he says.
There are also question about whether or not the moisture in the Southern Plains is causing some heifer retention or herd expansion.
