Grains closed mixed Wednesday, with livestock mostly higher.
Soybeans rallied for a third day on light short covering heading into the holiday and corrective buying as the market is oversold.
Vince Boddicker, Farmers Trading Company, says soybeans also saw spillover strength from soybean oil, which has rallied over 600 points in the August contract since bottoming June 25. “Bean oil has been moving higher with Indonesia announcing import tariffs that would hit palm oil, including supplies from China,” he says.
Corn ends lower and has been down eight out of the last nine sessions. Boddicker says corn followed wheat but has also been weighed on by favorable weather for the Central and Eastern Corn Belt.
Plus, he says the market continues to digest the bearish acreage and stocks numbers from last Friday’s USDA Reports.
Wheat is struggling to confirm a low. The market had a nice rally on Monday but failed to see any follow through Tuesday and Wednesday despite U.S. harvest moving past the 50% mark.
Boddicker says the market has priced in a the global production concerns and Russia is also harvesting their crop so that is providing some pressure. He says it will likely take a supply shock like Russia banning wheat to see a rally.
Cattle futures end higher on Wednesday, despite a lack of cash trade. “I would imagine cash trade will wait until after the holiday and break on Friday,” he says.
Boddicker points out that while numbers are tight that is being offset by weight trending well over a year ago.
Lean hog futures see more forward spreading and Boddicker think the market is trying to establish a bottom.
However, the market also struggles to rally with more up front supplies as indicated in the USDA Hogs and Pigs Report.
Boddicker says demand has also stalled out especially for bellies and that has limited the market.
