Market Closes - August 1, 2018

Posted on Aug 1, 2018

Corn Sep -7 365; Dec -7 379 (378-87)

Bean Sep -17 891; Nov -17 902 (899-915)

  Meal -5 334

  Oil -27 2862

Wheat Sep +4 558; Jly +4 597 (589-608)

  KC +7 564; MGE +2 608

Oats +3 239

Rice -4 1187

 

LC Aug +95 10862; Dec +105 11402; Feb +125 11802

FC Aug +250 15182; Oct +227 15222; Jan +207 15115

LH Aug -87 6025; Oct +5 5077; Dec -25 4630

Milk Aug +7 1483; Sep +4 1560

 

Optimistic trade talk lifted futures yesterday, but President Trump’s threat today of higher tariffs on Chinese imports pushed corn and soybean futures lower. Corn and soybeans closed near the day’s lows. Soybeans, meal and oil traded inside Tuesday’s ranges. Wheat futures sold off with corn and soybeans, but managed to still close higher around mid-range. Wheat has the better fundamental story with production losses coming in most of our competitor countries.

Cattle futures closed higher with Feeder Cattle outdoing Live Cattle as corn/soy futures fell about 2 percent. With cash cattle trading $110/cwt today, traders took advantage of the August LC’s discount to cash. Choice beef dropped .52 to 203.75 and Select lost .80 to 197.58.  Note that the Choice-Select spread is only $6.17/cwt. LC and FC basically erased the combined loss from Monday and Tuesday.

Lean Hog futures closed lower with the nearby August LH contract posting the largest loss. August and October LH hit new contract lows. LH was pressured by weaker cash hog prices and lower pork values -- FOB Plant Pork dropped .18 to 73.87. The August LH futures is around $10.00 below the CME LH Index used to settle the contract on August 14; these prices need to converge by then.

The FOMC meeting ended today and the Federal Reserve held their key interest rate unchanged. But the Fed is almost guaranteed to raise rates in September.  The bond market pushed US Treasury yields to the highest level since June 13. Today’s private jobs report was very strong; the Labor Dept will release its jobs/wages report Friday morning.

 

US$ +.2%

Dow -81 25334

SP -3 2813

NAS +35 7707

Tran -94 10983

  VIX +.32 13.15

 

WTI -110 6766

Brent -182 7239

Gas -4 204

NG -2 276

HO -4 210

Eth unch 144

Gold -6 1228

Slvr -11 1545

2-yr +.013 2.682%

5-yr +.027 2.875%

10yr +.041 3.005%

30yr +.049 3.131%

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