AgriCharts Market Commentary

Corn

March corn futures closed lower in today’s session. Overnight trading saw corn futures lower taking away some of Friday’s gains. A strengthening US dollar added bearish pressure to corn which was already weakened by competition from cheaper foreign feed wheat. The dollar strength is in part due to expectations of interest rate cuts by foreign central banks and the upcoming US administration’s economic stimulus package along with tax reform. These two outweigh the higher crude oil and support from soybean influences on corn. Weekly export inspections were also well below those of the same week a year earlier. March corn closed at $4.11 ¼ , down 1 cent December corn closed at $4.55 ¼ , down 1 cent

Soybeans

Soy complex futures finished mixed this session. Soybean futures and soy oil finished higher, while soy meal finished lower. A firming US dollar added bearish pressure to soy meal. A rising crude oil driven by the recent Israeli-Palestinian conflict, Russian-Ukrainian gas dispute, and a pipeline explosion in Nigeria provided enough bullish influence to overcome the firming US dollar bear pull to soy oil futures. Soybean futures reached a 3-month peak in part due to higher soy oil product value, solid export inspections (year to date is 55 million bushels above last year) and enough ongoing drier weather in Brazil and Argentina to maintain yield concerns. January soybean finished at $9.83 ¾ , up 13 ¾ cents January soy meal finished at $298.70, down 23 cents January soy oil finished at $34.90, up $1.32

Wheat

March wheat futures in Chicago, Kansas City, and Minneapolis settled higher after trading lower most of this session. A firming US Dollar Index allowed the market to erase this past Friday’s gains on wheat futures and kept wheat below its opening value, up until later during the day where wheat received spillover bullish support from soybeans to reach a 3-month high. On top of a stronger US dollar, weaker export shipments and no cold weather threats in the wheat belt limited gains to wheat futures. March CBOT wheat settled at $6.16 ¾ , up 5 ¾ cents March KCBT wheat settled at $6.42 ¼ , up 8 ¾ cents March MGEX wheat settled at $6.57 ¼ , up 2 cents

Cattle

February live cattle futures finished higher in today’s session. Feeder cattle futures finished trading higher as well. Cash beef prices and cash cattle sales were priced higher late last week compared to the previous week. Strength in the US Dollar Index due to news of the upcoming administration’s economic stimulus package and central banks expectation to cut interest rates, limited slightly the gains on cattle futures though. Lower feed grain futures allowed bullish support to feeder cattle, along with some major chart buy signals on the weekly continuation charts. Afternoon boxed beef prices: Choice – 144.97, up $1.78, Select – 135.64, up 14 cents. February live cattle finished at $87.55, up 45 cents January feeder cattle finished at $97.00, up $1.40

Hogs

Lean hog futures ended trading lower this session. A firming US dollar added the bear pressure needed to keep hog futures lower through most of day. The CME lean hog index for 12/31 was 51.66, down 16 points. Friday’s futures rally aggravated an already huge negative basis. Sometime soon, either the cash market will have to have a big rally or the futures will have to break. February futures expired in 39 days. Afternoon pork carlot prices: carcass – 55.65, up 80 cents, loins – 76.80, down 56 cents, picnics – 36.41, up $4.86, butts – 56.40, down 45 cents, ribs – 93.43, down 97 cents, hams – 36.94, up $1.96, bellies – 70.04, up 6 cents. February lean hogs settled at $62.67, down $1.17

Cotton

March cotton futures closed lower in today’s session. A firming US dollar kept cotton futures trading lower than its opening value. Rising crude oil is bullish for cotton via higher synthetic fiber prices, but was overshadowed by the strengthening US dollar. ICAC is also calling for a 10% cut in Chinese demand this year, and for the slowest world export shipments in 6 years. Mixed factors in other crop commodities and a lower stock market added to the bear pull on cotton. Open interest as of the open of today’s session for March cotton was 70,913, up 31. March cotton closed at 48.31 cents, down 60 points

Market Commentary provided by:

Brugler Marketing & Management LLC
1908 N. 203rd St.Omaha, NE 68022
Phone: 402-697-3623
Fax: 402-289-2353
E-mail: alanb@bruglermktg.com
Web: www.bruglermktg.com