|Hogs: Afternoon Comments (Tuesday, April 25, 2017 20:09:56)
Hog futures enjoyed strong spillover from yesterday's gains and ended high-range. Futures ended $1.25 to $2.45 higher in all but the front-month contract that ended 82 1/2 cents higher. Futures corrected the oversold condition of the market today, with additional support coming from a steady to firmer tone in the Iowa-Minnesota cash hog market. This hints of a potential cash low in the works. This morning's national daily direct hog report reflected the firmer tone had spread to other areas. This encouraged traders to widened the premium futures hold to the cash index.
Adding to support in hog futures were gains in the cattle market and a positive tone in outside markets. A weaker tone in the dollar index is helpful to pork exports and a sharp rise in the Dow Jones Industrial Average raises confidence in domestic spending on red meat.
|Soybeans: Afternoon Comments (Tuesday, April 25, 2017 20:13:24)
Soybean futures were weaker today and ended low-range with losses of 5 to 6 3/4 cents. Meal and soyoil were also lower. Following yesterday's gains, soybean futures were hit with profit-taking, as well as spreading with corn, which was firmer. Corn futures firmed on forecasts for heavy rains beginning tomorrow and lingering into next week. Soybean traders are concerned the rain event could result in some acres being shifted to soybeans, especially since yesterday's progress report showed soybean planting off to a better-than-expected start at 6% complete as of Sunday. Traders brushed aside the continued softer tone of the U.S. dollar index, as they expect only "fill in" business coming to the U.S. given the abundance of South American supplies.
|Corn: Afternoon Comments (Tuesday, April 25, 2017 20:12:46)
Corn futures settled 5 1/2 to 6 1/4 cents higher through the December contract. That was in the upper end of today's range, but off session highs. Corn futures were supported by forecasts calling for cool, wet weather over the next 10 days to two weeks across most of the Corn Belt. While planting progress was more advanced than expected and just one percentage point behind normal as of Sunday, the forecast suggests limited progress will be made through the first week of May. Therefore, the planting pace is expected to fall further behind normal. That was enough to encourage corrective buying in corn futures today.
With funds heavily short the corn market, it would not be surprising to see more near-tern short-covering if the wet and cool forecast verifies. It's difficult to imagine funds moving from an aggressive short stance to a long position, however. Plus, farmer selling will kick in on an extended rally. That limits upside price potential.
|Wheat: Afternoon Comments (Tuesday, April 25, 2017 20:13:55)
Wheat futures enjoyed solid gains today and settled near session highs. The SRW wheat market posted gains of 6 1/4 to 7 3/4 cents, while the HRW market ended 8 3/4 to 10 1/2 cents higher. HRS wheat led gains and settled roughly 12 to 13 cents higher. Wheat futures enjoyed some aggressive short-covering today as the greenback extended its slide and the Dow Jones Industrial Average again shot higher. The spring wheat market led gains thanks to USDA's update yesterday showing that just 22% of the crop had been planted as of Sunday, versus a five-year average pace of 34% done at this point. And wet, cool weather is expected to result in more delays this week.
USDA reported slight improvement in winter wheat crop ratings, though not as much as anticipated. This made it easier for the SRW and HRW wheat markets to follow corn and spring wheat higher today. Traders also corrected the technically oversold condition of these markets.
|Cotton: Afternoon Comments (Tuesday, April 25, 2017 20:14:28)
Cotton futures traded in a wide range on either side of unchanged today before settling high-range with gains of 57 to 90 points through the October contract, with deferred months narrowly mixed. Nearby cotton contracts benefited from USDA's crop progress update yesterday that showed planting efforts advanced just three percentage points over the past week to 11% complete as of Sunday. However, this was just a point behind the five-year average pace. Warm, dry weather should help progress to pick up this week, though heavy rains are possible for the mid-South later this week. Support also stemmed from customs data showing China imported 121,004 MT of cotton in March, up 109.07% from year-ago levels. Its first-quarter imports of 375,160 MT were also up notably (78.97%) from last year. This reminds the market that global demand for U.S. supplies has been much stronger than anticipated.