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Closing Comments

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Closing Comments

Corn recovered from the weakness in the overnight session reaching its highest price since June 30 and closing (+X). The Energy Information Administration (EIA) released the weekly ethanol update. As expected, production declined from 1.055 million barrels/day to 1.040; however, it continues to be much stronger than USDA corn demand estimates. The report also identified that despite the production decline stocks continued to rise reaching the highest since March 2016.

 

Soybeans opened the day slightly below yesterday’s close and gained some momentum throughout the day closing near the session high at (+X). Recent price strength is technical and influenced by investment fund money flows rather than substantial changes to fundamental factors. The National Oilseed Processors released reports on soybean crush, soymeal exports and soyoil stocks. Its members crushed 160.621 million bushels during January, up from 160.176 million bushels in December. They exported 891,143 tons of soymeal down from 949,615 tons during December, and reported soyoil stocks of 1.629 billion lbs as of January 31, up from 1.434 billion lbs at the end of December.

 

Wheat made a comeback today closing near the high at (+X). Hard red winter wheat spot basis bids were unchanged in the southern U.S. Plains as futures hovering near their highest levels since June enticed some farmers to sell. In world news, Russian farmers have large quantities of wheat available to sell however; the strength of the Russian ruble is slowing export sales. Euronext wheat futures rose to fresh six-month highs on Wednesday, supported by hopes that a weakening euro will boost exports.

 

Live Cattle traded above the open briefly, but ended the session near today’s low closing (-X). The USDA Daily Slaughter Report shows that this week’s 111,000 cattle is considerably higher than this week last year at 101,000.

 

Hogs posted positive gains today closing (+X). The April contract is currently benefitting from additional buying stirred by Tuesday’s firmer cash and wholesale pork values. The USDA reported Tuesday afternoon’s average cash hog price in Iowa/Minnesota at $72.38 per cwt, $1.00 higher than on Monday. Both good pork demand and profitable margins offer incentives for packers to put as many pigs through plants as possible.

Closing Market Snapshot

 

All opinions expressed in this commentary are solely those of Water Street Advisory. This data and these comments are provided for information purposes only and are not intended to be used for specific trading strategies. Although all information is believed to be reliable, we cannot guarantee its accuracy or completeness. There is significant risk of loss involved in commodity futures and options trading and may not be suitable for all investors.

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