Market Closes - August 13, 2019

Posted on Aug 13, 2019

Corn Sep -19 366; Dec -16 376 (376-88)

Bean Sep +9 876; Nov +10 889 (875-97)

  Meal +6 299

  Oil -49 2917

Wheat Sep unch 472; Jly unch 494 (488-501)

  KC -9 383; MGE -6 503

Oats unch 272

Rice -11 1145

 

LC down the expanded limit of $4.50

Aug -450 10055; Dec -450 10395; Feb -450 10820

FC Aug -667 12772; Oct -620 12755; Jan -507 12702

LH Aug -17 7900; Oct -250 6457; Dec -75 6302

Milk Aug -3 1758; Sep -4 1774

 

CBOT futures closed mixed with corn futures closing sharply lower for the second day due to the very bearish USDA crop production report (traders still question the math). Also weighing on corn was Monday’s crop rating that was unchanged from a week earlier and was better than trade expectations. Add to this a non-threatening weather forecast. Ethanol futures have fallen over 10% in the last two days even as crude oil prices rose. Corn has been sold aggressively by the speculative funds who went into the report very long the corn market. Chart wise, corn futures gapped lower and traded low enough to fill the upside gap made on May 14 when the $1.10 rally got started. The specs’ margin calls are leading to liquidation. Corn is only 12-13 cents from the contract low.

In contrast, soybean futures rallied on its friendly production forecast. Support came also from news that the US and China are still negotiating trade by phone and that President Trump delayed some of the new 10% tariffs on select consumer items to December (Merry Christmas!!!).

Cattle futures closed sharply lower (and made new Contract Lows) for the second day in reaction to reduced harvest capacity after a fire closed a large Kansas plant. Live Cattle closed down the expanded limit of $4.50/cwt; the same daily price limit applies on Wednesday. Feeder cattle futures traded more than Live Cattle but still fell sharply. On the output side, boxed beef values soared on concerns for nearby beef supplies. Choice beef jumped 7.74 to 226.36 and Select rose 2.79 to 200.58. This is on top of Monday’s gains of 2.25 in Choice and 3.98 in Select beef. Packer margins are reportedly over $180/head, so this may encourage other plants to pick up some of the lost capacity. Somewhere along the way, this should create a buying opportunity.

Lean Hog futures traded to the upside but eventually closed lower under pressure from cheaper pork values and the sharp losses in the cattle futures market. FOB Plant Pork fell .98 to 89.21 with a 5% loss in ham value.

 

US$ +.5%

Dow +373 26280

SP +43 2926

NAS +153 8016

Tran +115 10149

  VIX -3.57 17.52

 

WTI +189 5674

Brent +238 6095

Gas +6 173

NG +5 216

HO +7 187

Eth -6 128

Gold -4 1502

Slvr -13 1694

 

2-yr +.089 1.669%

5-yr +.092 1.577%

10yr +.055 1.695%

30yr +.027 2.157%

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