Tuesday May 26, 2020
US$ lost .63 to 99.80 Looks like we are going to hang around 100
1.320.760.0332
CORN
The July corn futures lost 1 cent last week ending at 318. This morning the trade remains range bound topping out at 321. Experts say a closing value above 322 is needed to encourage more higher prices. So far those resistance numbers have meant a 5-6 cent pullback. Perhaps acreage and crop conditions can get us past the barrier. A terrible scenario would be seeing December corn get to 350 making cash still less than 300 in most areas. The trouble is that it is too close to real. The simple answer is that production needs to be limited and demand needs to increase.
SOYBEANS
Soybeans lost 5 cents last week with the July contract ending at 833. That is certainly the low end of the recent trading range with last week’s low near 828. So we did not blow through 860 (not even close). This week is off to a little better start 10 cents higher at one point probably due to a nice export sale announcement to China. Keep them coming. Otherwise the word will be conditions, conditions, conditions, as in growing conditions.
CATTLE
August live cattle futures lost 50 cents last week ending at 9732. This is still extremely ugly but is being ignored by the processor where the cash market traded as high as 121 and in a range of 115 to 121. Because this is a futures market I am afraid no one believes the 120 is going to hang around mostly due to the fact that cattle are backed up in the feedlots and the boxed beef prices have certainly lost their luster. It will be interesting to see the reports of beef movement over the counter for the weekend. I had hamburger shock when I looked at a pound over 8 dollars. Right now it looks like selling anything you can near 120 is a gift.
Milk
Milk futures gained 30 cents for the week with June ending at 1715. That would be a decent price to get in June and with a few support programs out there perhaps whoever is left has a chance to survive. So to me the key has been the decrease in cow numbers and heifer retention appears to have slowed. Have we turned the corner? The problem is that this economy is extremely fragile and a second round of virus will be the tipping point. FYI a June 1700 put is 50 cents.
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