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Closing Comments

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Closing Comments

Corn closed the day, and the week for that matter, at the highs and will be looking to weather for a change in momentum on Sunday night.  For now though, corn has continued its upward bias on better than expected demand and lingering issues with Brazil’s second corn crop.  Export this morning showed corn totaled 52 million bushels and slightly beat expectations.  On Friday next week the USDA will have its monthly crop report, and expectations are to increase exports between 25-50 million bushels.  A much drier forecast currently exists for much of the corn belt and funds seem to be buying into it for now, although temperatures will be average.  Informa was out today and they lowered their Brazil corn production forecast to 78.9 mmts, down 1.1 mmt from May.

Soybeans have now traded back to their highest level since end of August of last year.  Active rumors involve China looking for more old crop beans gave the big surge yesterday and into Thursday’s overnight session, and the expectation was that they would not be replacing reserve sales but may not be the case.  Soybean export sales totaled 38 million bushels and 27 million was from new crop, highest of the season so far.  Exports will be closely watched over the next couple of weeks to see if there are any changes from South America to the US as a source of old crop beans.  Informa lowered the Brazilian soybean production down to 98.5 mmt, from 100.0 mmt and left Argentina soybean production unchanged.

Wheat was helped along by a devastating break in the US dollar and unwinding soybean/ wheat spreads.  Informa raised their US winter wheat expectations by 40 million bushels to 1.448 million total bushels.  A bigger jump in winter wheat could be expected in the June crop report and a new record yield as well.  New crop wheat sales totaled 14 million bushels and in line with what was needed to hit the USDA’s export forecast.

Cattle held a relatively quiet day and closed slightly higher.  For the week, the turnaround from the very bearish COF report has maintained but not much news has been involved.  Fats have struggled to move above the 200 day moving averages and is proving difficult for the time being, but will be the area to watch next week.

Hogs put another strong day today.  Record corn prices in Brazil are starting to have a domino effect by means of liquidation of sows they cannot afford to feed and poultry processors to close plants.  Therefore stronger imports for the country down the road maybe needed to help curb higher domestic prices that will follow after the liquidation.

Closing Market Snapshot

 

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