Top Farmer Midday Update 7-17-19

CORN: Corn futures are trading just slightly higher in early trade today with Sep up 1/2 of a cent to 4.35-3/4, while Dec and Mar are steady at 4.41-1/4 and 4.48-1/2 respectively. Forecasts have turned to show below normal temperatures and below normal precipitation. The below normal temperatures is a bearish development because cooler weather in July usually correlates with a higher final yield. Peak planting for corn should fall between July 20 and August 10 this year and a lack of hot temperatures at least through July will keep the crop in good shape. Still, there are large parts of IL, IA, MO, and IN that are still too dry. Price action has been mostly sideways today with Dec corn trading as high as 4.47 and as low as 4.37. The unsuccessful test of overhead resistance this morning was disappointing, and technical analysts are pointing to a head and shoulders formation that could point to lower prices. During yesterday's session, speculative funds were thought to have sold 18,000 contracts of corn.

SOYBEANS: Soybean futures are trading slightly lower so far this morning with Aug beans down 2-3/4 to 8.85, Sep beans are down 2-1/2 cents to 8.91-1/4, and Nov beans are down 2 cents to 9.04. Despite news that the U.S. and China trade negotiation teams would be having conversations, this week, President Trump's comments that he could still impose additional tariffs on China and that negotiations will take some time were seen as negative. Below normal temperatures for the second high of July were also bearish. Weak feed demand in China has slowed crushing activities and Chinese buyers have begun to push delivery dates back. Nov beans closed below nearby support levels yesterday was disappointing, though prices did hold some trendline support. There is a head and shoulders formations developing on the charts that could point to lower prices bearish fundamental news. Funds were thought to have sold about 10,000 contracts of beans during yesterday's session.

WHEAT: Wheat markets are mixed this morning with Sep Chi wheat up 1/2 of a cent to 5.08, Sep KC wheat is down 1-3/4 cents to 4.44-1/2, and Sep spring wheat is down 1/2 of a cent to 5.29-3/4. Wheat markets are finding some support today from an Egyptian tender for late August delivery. Wheat markets are also finding some overflow buyers from at stabilization in the rest of the grain complex today. The winter wheat spread continues to weaken with hard red winter wheat harvest producing exceptional results. The Sep Chi wheat contract has made its sixth successful test of its 50-day moving average level in just seven sessions today. KC contracts briefly tested some overhead resistance this morning and have since backed off. Speculative funds sold about 1,000 contracts of Chi wheat yesterday.

CATTLE: Cattle markets are lower again this morning as the momentum begins to turn over. Aug lives are down 30 cents to 107.92, Oct lives are down 65 cents to 108.60, and Dec lives are down 67 cents to 113.05. Aug feeders are down 1.35 to 139.70, and Sep feeders are down 1.67 to 140.20. Live cattle markets remain sluggish without beef values confirming the anticipated strength. Most are expecting that cash trade will continue to trend higher this week, especially given the widening choice select spread. Aug lives are trading at a discount to the cash market which should give futures some room to move higher. Momentum indicators are turning lower, but live cattle markets have so far held nearby support at the 10-day moving average levels. Feeder markets fell through their 10-day moving average levels this morning and are holding onto their 50-day moving average support levels.

HOGS: Hog markets are higher this morning with Aug up 85 cents to 79.90, Oct is up 1.37 to 76.67, and Dec hogs are up 1.35 to 74.70. Both the Oct and Dec contracts are showing gap higher sessions today and the Aug contract is up despite a sluggish cash index. Pork values have been choppy domestically, but the market is finding it tough to ignore the surge in spot pig prices and pork values. Yesterday's closes were very impressive technically and are likely responsible for a lot of the buying today.




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