Stewart-Peterson Market Commentary

Closing Commentary - June 21, 2018

Top Farmer Midday Update 6-21-18

CORN: Corn futures are firm ahead of the expiration of Jul options tomorrow. Sep and Dec corn is 2-1/2 cents higher to 3.66-1/4 and 3.78-1/4, respectively, while consolidating in the wake of ‘headline’ news that’s been rocking many markets. Record open interest across the basket of agricultural commodities was reported on June 19, the day of the market crash. Weather remains conducive with plenty of widespread moisture noted ahead of a high pressure ridge forecasted for the first half of July that is expected to result in heat and humidity. This morning’s USDA Weekly Export Sales were disappointing for old crop, coming in at only 165,900 tons (6.5 mil bu), but shipments were good at 1.7 mil metric tons. New crop sales were in line with estimates at 339,700 tons (13.4 mil bu).

SOYBEANS: Soybean futures are down about a nickel to 8.84-1/2 in Jul, 9.05-1/2 in Nov. USDA Weekly Export Sales were at the low end of trade estimates for old crop at 301,700 tons (11 mil bu) and new crop sales were in the range of estimates at 227,600 tons (8.4 mil bu). The near and intermediate-term soybean trends are bearish. However, Nov beans are oversold and overextended technically, which leaves the market vulnerable to a correction or consolidation phase. Contracts are trading an ‘inside day’ for the second day in a row and are poised to test the boundaries of the wide trading ranges going into the July 6 trade tariff deadline.

WHEAT: Wheat futures are higher with Sep CBOT wheat up 7-1/2 cents to 5.06-3/4, and between the contract’s 100 and 200-day moving averages. Sep KC wheat is up 4-3/4 cents to 5.10-1/2, and below both the 100 and 200-day moving averages. This morning’s USDA Weekly Export Sales were in the upper range of estimates at 461,600 tons (17 mil bu).

CATTLE: Cattle futures are weaker with Jun fats steady at 108.775 after narrowing the gap between futures and this week’s cash trade that occurred at $110/cwt in Wednesday’s online auction. Aug cattle broke through 100-day moving average resistance to a 3-month high on Wednesday, and looks to respect that area near term. Aug feeders are down 0.300 to 149.125. We’ll get a Cattle on Feed report tomorrow after the close with trade estimates at 103% on feed as of June 1 vs a year ago; 105.2% marketed; and placements at 96%.

HOGS: Hog futures are mostly lower with the exception of the nearby Jul contract which is firm at 80.050. Aug hogs are down 0.450 to 74.700 after tumbling below all of the contract’s moving averages; and Oct hogs are down 0.875 to 60.400. Trade sources cite negative market reaction to trade talks that may steer non-U.S. pork to Mexico, thus the potential for lower demand in the coming months. Meanwhile, bids in the cash market are mostly steady.

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