Stewart-Peterson Market Commentary

Closing Commentary - December 14, 2018

Top Farmer Midday Update 12-14-18

Corn: Corn futures are higher this morning, up 3-1/2 cents to 3.79, Mar is up 2-1/2 cents to 3.86-3/4, and May is up 2-3/4 cents to 3.94-1/2. Prices have so far tested the 10-day moving average support level but found buyers on speculation that China may begin to buy U.S. corn starting in January. Informa has estimated 2018 corn production at 1.4601 billion bushels vs the current USDA forecast of 1.4626 billion bushels. This would indicate a 178.6 bushel per acre yield vs the current estimated yield at 178.9 bushels per acre. During yesterday's session, funds sold 3,000 contracts of corn and are now thought to be long about 49,000 contracts.

Soybeans: Soybean futures are slightly lower this morning, with Jan down 1/2 cent to 9.06-1/2, Mar down a penny to 9.19-1/2, and May down 1/2 cent to 9.32-3/4. Exporters sold 300,000 metric tons of soybeans for the delivery to China this morning, the second major sale to China this week. After yesterday's closes below the 10-day moving average support levels, prices rallied up and tested the 10-day moving average resistance but were unable to break through. China announced this morning that it would suspend additional tariffs on U.S. made vehicles and auto parts from January 1 until the end of March, further evidence that U.S./China trade talks are moving forward. Funds sold 9,000 contracts of beans yesterday and are thought to be short about 19,000 contracts.

Wheat: Wheat markets are mixed this morning, with Mar Chi wheat down 3-1/4 cents to 5.32-3/4, KC Mar wheat is up a penny to 5.21, and Mar Mpls wheat is down 1-1/2 cents to 5.86-3/4. The Mar KC/Chi spread is up 4 cents today to 12 under. That spread has gained 7-1/4 cents already this week. After speculation earlier this week that Russian exports are said to decline in December, and new rumors of Russian export curbs coming soon, yesterday's sharp gains likely left prices overbought, hence the technical setbacks today. During yesterday's session, funds bought about 6,000 contracts of Chi wheat and are now short about 20,000 contracts.

Cattle: Cattle markets are mixed to mostly lower this morning, with Dec lives up 12 cents to 119.57, Feb lives are down 17 cents to 122.67, and Apr lives are down a dime to 124.70. Jan feeders are down 22 cents to 147.75 and Mar feeders are down 7 cents to 145.85. Prices look to be losing momentum higher, as warm and dry weather in the Plains should make weight gain easy. Cash trade today has been quiet so far, with published bids currently at $115 in NE and $118-$119 in KS, TX, and CO.

Hogs: Hog markets are higher this morning, with Dec up 17 cents to 54.97, Feb hogs up 1.07 to 65.90, and Apr hogs are up 55 cents to 70.90. U.S./China trade discussions appear to be moving along nicely with a published soybean sale today, rumors of corn sales at the beginning of 2019 and an announcement from China that they will suspend taxes on U.S. made vehicles in January. Mostly though, hogs remain in a traders' market, and since the recent drift to the low end of the range, buyers have stepped back in. Pork values should stay strong into the holiday season.

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