Corn Futures Get Boost From Optimism Over China Trade Deal
Corn for May delivery rose 1.1% to $3.47 1/4 a bushel on the Chicago Board of Trade on Tuesday, with the USDA's confirmation of Chinese interest in U.S. distilled grains as part of the implementation of the Phase One trade agreement spurring excitement among traders.
Soybeans for May delivery rose 0.3% to $8.86 a bushel.
Wheat for May delivery fell 0.2% to $5.61 1/2 a bushel.
STORIES OF INTEREST:
Export Weakness Still a Pressure Point for Grains -- Market Talk
11:46 ET - Although domestic demand has gotten a short-term boost from consumer panic-buying thanks to coronavirus, this strength is expected to soon recede. One reason for this is that with coronavirus, export demand globally for US agricultural products is muted -- something that a run on grocery stores by consumers won't alone offset. "The total impact of exports has been a huge negative," says Dave Marshall of First Choice Commodities, pointing to Monday's weak grain export inspection figures as confirmation that once consumers are stocked up on the food they need for their homes in the US, American grains outlet to other nations has been constrained as coronavirus keeps people at home. (email@example.com; @kirkmaltais)
Wynnstay Group Trading to February Was Weak; Warns on Virus-Fuelled Uncertainty
Wynnstay Group PLC said Tuesday that trading in the first four months of fiscal 2020 was weak as expected and warned on the "very significant" uncertainty associated with the progressing coronavirus pandemic.
The agricultural-supplies group said its performance suffered from lower farmgate prices, rough weather and continued farmer cautiousness.
USDA Update on Phase-One Progress Stimulates Grain Futures -- Market Talk
13:48 ET - The USDA's update on the progress in fulfilling the obligations of the Phase One trade deal between the US and China helped pull grains futures on the CBOT higher. Corn futures in particular get a boost, with traders hopeful increased Chinese purchases of distillers dried grains with solubles, a byproduct of ethanol production, would help stimulate the troubled US ethanol industry. "The news that the US/China are making fresh progress on Phase 1 US ag purchases lifted CBOT futures heading into midday," AgResource says. Corn futures on the CBOT are trading 1.3% higher. (firstname.lastname@example.org; @kirkmaltais)
Ethanol Woes Expected to Keep Corn Down -- Market Talk
0902 ET - Low oil and gas prices creating poor margins for ethanol producers to operate will likely keep pressure on corn futures, says Tomm Pfitzenmaier of Summit Commodity Brokerage. "The corn market is going to continue to underperform as long as ethanol production and blending margins stay negative and cheaper South American corn beyond June is going to make the going tough for exporters in the last few months of the marketing year," says Pfitzenmaier. Cuts to ethanol production have been reported in the past week, and on Monday Poet announced that it had stopped buying corn at a number of locations. Corn futures on the CBOT fell 1% overnight. (email@example.com; @kirkmaltais)
Cattle Futures Close Limit High For Second Day -- Market Talk
15:32 ET - June cattle futures finish trading limit high--which they hit once the market opened at 9:30 am ET, up 4.9% to 97.025 cents per pound. The reaction to Sanderson Farms' decision to leave its McComb, Miss. plant open for operations despite an employee testing positive for coronavirus, has traders looking at cattle futures as ripe for a bounce off recent losses. "CME cattle futures became too cheap on the fear that a Covid-19 infection would close a kill plant for 2 weeks," says AgResource. Meanwhile, lean hog futures finish 2.9% higher at 73 cents per pound. (firstname.lastname@example.org;, @kirkmaltais)