GRAINS:
Ag markets were very strong out of the gate Tuesday, led higher by soybean and wheat futures with the former finding strength following President Trump’s decision to forego implementing new tariffs during his first day in office Monday, although the president did set a tentative date of Feb. 1 for tariffs on Mexico and Canada, while refusing to give a timeline regarding any action against China. This combined with last week’s CPI data which singled out energy costs as an inflation driver, had crude oil prices breaking following Trump’s pro-drilling statements. All in all, this has halted inflation fears at least for the moment, with the U.S. dollar breaking hard toward 30-day lows, which in turn supported wheat futures on their way to their highest prices in over a month. March corn closed up 5 3/4 cents and May corn was up 6 3/4 cents. March soybeans closed up 33 1/4 cents and May soybeans were up 33 cents. March KC wheat closed up 27 cents, March Chicago wheat was up 20 cents, March Minneapolis wheat was up 21 cents.
LIVESTOCK:
The live cattle complex is trading mixed, but with a mostly lower tone as the market holds its breath waiting to see what develops this week for fundamental support. Given that last week packers bought 80,966 head of cattle in the negotiated cash cattle market and 68% of them were committed to the nearby delivery — feedlot managers are hopeful to trade cattle higher again this week, but steady prices may be the market’s outcome. Upon seeing the continued rally in the corn complex, and the live cattle market not lending much support, it really comes as no surprise to see the feeder cattle complex trading lower. The lean hog complex is also trading mixed as the market needs to see fundamental support resurface before it will likely attempt to trade higher again this week. Consumer demand was excellent last week, but the market’s technical resistance at $91.00 seems to be weighing heavily against the market currently. Not to mention, it’s not helping either that pork cutout values are slightly lower.
