GRAIN:
The 11 a.m. CST drop of the February World Agricultural Supply and Demand Estimates (WASDE) report by the USDA was, as some expected, an extremely quiet affair. Still, the lack of bullish updates to U.S. balance sheets has taken some wind out of the row-crop markets sails after a firm start to the session ahead of the report. Traders will now spend the balance of the week digesting the new information and choosing where to place price bets moving forward. In outside markets, it was also a quiet day of mixed influence with equity markets down slightly, but the U.S. Dollar Index also easing following three straight days higher. March corn closed down 7 1/2 cents and May corn was down 6 1/2 cents. March soybeans closed down 6 cents and May soybeans were down 5 1/4 cents. March KC wheat closed down 4 cents, March Chicago wheat was down 2 1/2 cents, March Minneapolis wheat was down 7 cents.
LIVESTOCK:
Monday’s higher trend was quickly forgotten about when Tuesday’s market opened up as the live cattle contracts were pressured from the day’s start. Trying to pinpoint what exactly is driving the market lower remains a challenging task as pressure is imploding from a number of different angles: from traders liquidating some positioning through money-managed funds to the concerns about what could develop with this new strain of bird flu to the fundamental reality that cash prices could trade lower this week and that February is typically a hard month for beef demand given that it’s a long time until grilling season. Without the technical support of the live cattle contract’s higher trade, the feeder cattle contracts also traded lower in a dramatic manner. The lean hog complex traded mixed into Tuesday’s close as again the nearby contracts are up against resistance, wanting to take out the long-term resistance pressure at $92.00 but aren’t confident that the market holds enough gusto to do so. It isn’t ideal for traders either that pork cutout values were slightly lower this morning, but that could easily change if the afternoon numbers show better.
