Morning Market Report- 3/18/21- Grains Mostly Weaker

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Grain markets are weaker across the board, although this has meant little for final settlements so far this week. Traders will be watchful for any developments out of the meetings between Chinese and U.S. officials today in Alaska. Soybeans on China’s Dalian Exchange were down 1.79% while soybean meal was down 0.46% and corn was down 0.62%.

Even though April cattle futures are in a channel that has been declining ever so slowly so far this month, price went from the low of the price channel to the high. This indicates there is optimism that cash cattle will trade higher before the end of April. That is a good possibility as demand is strong. Exports sales will be closely monitored Thursday. Slower exports sales could temper price enthusiasm. There was some scattered trade developing Wednesday at $114 in the South and steady with the past number of weeks. Feedlots hope that holding out until later in the week will push packers into bidding higher.

June and July hog futures moved above $1.00 per pound Monday and were joined by August Wednesday without batting an eye. Futures seem to be in a vacuum with no price resistance. Packers are getting hogs bought and are not shy about doing it. Hogs seen to be destined to match the price of cattle in a short period of time if this continues. How often do you see that? Supply is tight and not likely to change anytime soon. Saturday slaughter is projected at 78,000 head, indicating a tightening supply. Consumer demand remains strong with no sign of price resistance. New highs were posted in April through October futures. The sow herd in China is projected to have fallen 3% to 5% since December due the renewed outbreak of African swine fever, according to Rabobank. This may delay China rebuilding their hog herd until sometime in 2023.

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