Stewart-Peterson Market Commentary

Closing Commentary - July 18, 2019

Top Farmer Midday Update 7-18-19

CORN: Corn futures are looking very soft this morning with Sep down 10 cents to 4.26, Dec corn is down 10-1/2 cents to 4.31, and Mar corn is down 9-3/4 cents to 4.39. Prices have fallen below their 50-day moving average levels, which is a major technical development. Widespread rains today, as well as cooler temperatures for the next two weeks, are providing some fundamental justification for the negative technicals today. The U.S. sold 200,000 tons of corn for the week ending July 11, down 60% from last week and down 21% from the previous 4-week average. Speculative funds sold about 6,000 contracts of corn during yesterday's session.

SOYBEANS: Soybean futures are trading moderately lower today, with Aug beans down 6-1/2 cents to 8.76, Sept beans are down 6-1/2 to 8.81-3/4, and Nov beans are down 7-1/4 cents to 8.93-1/4. Trade talks between the U.S. and China appear to have stalled for the time being and weather is non-threatening. Prices have held near term support levels so far today, but a close below 8.94 in Nov today would be a bearish technical development. Momentum is still pointing lower. The U.S. sold 128,000 tons of beans for the week ending July 11, down 3% from last week and down 68% from the previous 4-week average. Funds were thought to have sold about 5,000 contracts of beans during yesterday's session.

WHEAT: Wheat markets are trading moderately lower today with Sep Chi wheat down 7-3/4 to 4.97-3/4, Sep KC wheat is down 6 cents to 4.35-3/4, and Sep spring wheat is down 1/2 of a cent to 5.27-1/4. Winter wheat harvest continues to pressure prices along with a sharper lower corn market today. Egypt's tender was also fulfilled by Russia yesterday, another bearish factor. Sep Chi wheat is trading sharply below its 50-day moving average for the first time since May 15. This is negative and opens up the door for more downside. Next support comes in around 4.86. KC wheat is approaching its nearby lows around 4.30 and Sep spring wheat is approaching recent lows around 5.25. The U.S. sold 347,000 tons of wheat for the week ending July 11, up 22% from last week and up 2% from the previous 4-week average. Funds sold about 3,000 contracts of Chi wheat yesterday.

CATTLE: Cattle markets are choppy this morning, staying within their recent consolidation ranges. Aug lives are up 2 cents to 108.15, Oct lives are down 12 cents to 108.62, and Dec lives are down 20 cents to 113.15. Aug feeders are up 7 cent to 140.65, and Sep feeders are down 2 cents to 140.75. Beef values cannot get any traction higher despite the expectations for retail demand to pick up. Cash cattle are expected to move higher this week, but until we see confirmation, cattle futures will likely have trouble rallying due to the overbought technicals. Trade has also been mostly quiet today due to position taking ahead of tomorrow's Cattle on Feed report.

HOGS: Hog markets are mixed this morning, with Aug up 52 cents to 82.52, Oct is down 1.05 to 76.77, and Dec is down 62 cents to 75.10. The best traded Aug contract has recovered some sharp losses from earlier in the session and the deferred contracts have tested and failed overhead resistance. Gaps are still open on the Oct and Dec charts. Pork values have been rallying this week and production has been tapering off, both positive developments.




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