Soybeans and corn futures reached new highs early Monday, while cattle and hogs saw declines, according to market activity reported on May 4. Wheat initially opened lower but later rebounded.
The rise in soybean prices was attributed to strong domestic crush demand and anticipation of increased Chinese purchases ahead of a mid-May meeting between the United States and China. John Heinberg with Total Farm Marketing said, “You got the technical breakout. So we’re seeing some money flow triggering that. You still got this really good demand on the crush side here domestically in that regard. So I think that’s supportive of the market as well. But then obviously, too until that meeting happens on the 14th to 15th and this market might be building some anticipation that China could step into the market, either old crop, new crop, pick up some beans in that regard. So I think that’s some of what’s happening here.” Crush margins have been strong due to high global biofuel demand and record-high bean oil prices.
USDA’s March report showed a record soybean crush at 227.4 million bushels despite being below expectations. Heinberg said regional tightness is being discussed: “I’m hearing some different talk about some regional tightness… if margins are good, crushers will pay whatever they want to per bushel of beans, just as long as they’ve got the crush margin taken care of and profitability coming.” He also noted processors may soon look to import cheaper South American soybeans due to price differences.
Corn futures followed soybeans higher overnight before easing slightly as wheat pulled back and farmer selling increased. December corn briefly topped $5 before retreating; Heinberg said a close above $5 could open further gains: “I think people that missed the first chance at it are now jumping on the second chance… Historically, $5 corn is a pretty good point to definitely get some things going.” The upcoming May World Agricultural Supply and Demand Estimates (WASDE) report is expected to provide more clarity on supply for next year.
In livestock markets, live cattle futures dropped after reaching record highs last week but remain fundamentally supported by limited supplies according to Heinberg: “The numbers just aren’t out there even look at the feeder market trading $4 under the index today.” Lean hogs have declined following reports of pseudorabies cases but may be near support levels: “If you draw a line underneath the low going back to November… It does look like it’s at least a level that maybe this market can hold,” he said.
AgWeb authors publications covering commodity markets and farm leadership strategies according to its official website. The organization also influences farming culture through leadership programs and community advocacy as reported by AgWeb. In addition, AgWeb presents awards such as Top Producer Awards in partnership with groups like the American Soybean Association for conservation honors according to its website. It operates as a subsidiary of Farm Journal according to AgWeb.
AgWeb reaches agriculture professionals via extensive online content as stated by its official site and aims to provide farmers with essential news updates along with educational resources for improved agricultural practices according to AgWeb.
