Grain futures prices were strong in today’s trade as traders, hedgers, and other market participants look to tie up loose ends ahead of tomorrow’s USDA report.
Transcript
Scott Shellady:
got the two minute warning in my ear Oliver, Oliver slow Blue Line futures in Chicago 120 seconds brother haveyou mentioned that this positive day really across the board does kind of feel like its limit up, although we’re obviously far from it outside of the car and markets. But nice to see a move out above the 20 day moving average. I’m sure other analysts have covered that as well.
Oliver Sloup:
We haven’t seen a close above there, and corn since December and November for the soybeans. So I think some of this is probably just some self fulfilling technical buying and short covering ahead of tomorrow’s report. There’s obviously a much bigger report at the end of the month, I’m sure people are starting to get position for as well. So this this is the first rally though in a long time that we feel like is might be sustainable, at least for the time being, I think eventually it probably will get sold into but this time of year, you get some uncertainty that comes into the markets, not just from weather in the United States with South America as well as in particular, the corn market ties hot and dry down there and some of those top producing areas for that second crop. So it’s gonna be interesting to see what the USDA does for production down there, as well as soybeans down in Brazil. Now that we’re over 50% through harvest in Brazil, will the USDA finally, you know, roll back some of their expectations for Brazilian soybean production? They’ve been slow to do so so far, but maybe with a little bit more data, they’ll have a little bit more reason to tomorrow’s report. Real quick.
I mean, I just said I’m an analyst that said that the Brazilian farmers are a lot like the US farmer, they are undersold in their corn Have you heard something like that to a lot of farmers think the same way. I think a lot of people are pretty undersold across the board demand is going to continue to be a dark cloud that probably damaged any significant relief rally so you look back in 2019 where we got a sharp kind of V shaped recovery into the springtime that eventually ended up making new lows I think we do get a rally in the springtime but I think producers are going to want to take that as an opportunity.
Scott Shellady:
All I hear from you Oliver is don’t be asleep at the switch. Alright, we’re gonna go away we’re gonna take a quick break we’re gonna come back and talk more meets with Oliver slope. He’s with blue line futures in Chicago. We’ll be right back after this. Spring in Oliver slope, Blue Line futures Chicago, Oliver anything jump out of you there they look so interesting.
Oliver Sloup:
Well, live cattle look fantastic. We’re continuing to bump our heads up against resistance, I think that we’ll probably believe be able to chew through resistance and make a move up into the mid 190s For that April contract, but we really need to see cash firm up that I think really kind of re accelerate that upside move. Now feeders on the other hand, there are positive for the most part today, it really kind of exceeded my expectations. If you would have told me that, you know, we’d have corn trading off the lows like it is today, I would have thought that feeders could be under pressure, you know, one or two bucks, but they’re holding their own. And I think that probably you know, is a sign of some good underlying strength in that market. Now, seasonally, this is a time to see some weakness and feeder. So I’m optimistic on live cattle, I’m a little bit hesitant to get overly optimistic on feeder cattle, especially after the run that they’ve had over the last several months. So for people looking to get some downside protection on I really think this is an incredible app opportunity at these levels. Anything from the outside markets, Jay Powell or non-farm on Friday, tomorrow that could maybe give you a little bit of help and what you think the some of the consumers could afford for this meat got about 10 seconds.
Oliver Sloup:
Yeah, well, he was speaking in the last couple of days and you’re seeing the outside markers to respond. It is bye bye everything rate cuts are still alive and well on the table. It’d be interesting to see if that actually plays out.
Scott Shellady:
We had a very well respected economists on the show earlier today. I’ll run I’ll let you know. won’t bury the lead. He thinks there is a chance of a rate cut or mean rate hikes sorry rate hikes. So yeah, it’s interesting stuff. Thank you very much. Yeah, I agree. All right, Oliver, slow Blue Line futures in Chicago. Bring it back here and give it back to you Susanna. It’s interesting.