Traders Brace for Bigger Carryout in Corn and Beans, Cattle Market Stays Cautious

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For the last 2 weeks and again last night it is clear that traders are expecting larger carryout numbers than the ones seen from the analysts above. Traders in both corn/beans are either expecting no acreage decline today or they are expecting a major yield increase.

To clarify on some terms recently used:

Analysts – Those working numbers to suggest what a report may show (Allendale research, RFD, CNBC)

Traders – Those placing orders in the market (hedgers, elevators, funds)

Cattle – Friday narrowed the gap of futures/cash, BB still choppy and sideways, funds sell 22K

↔Friday’s PM BB was choice +0.59 Select +0.56 packer BE at 194.09, packer cushion $5.32

↓ Funds were major sellers of cattle through last Tuesday selling 22K, now long 54K or 35% of record

↔Funds are still liquidating quite a few commodities so for cattle that might mean more selling, not something as predictable as in grains but something to keep a close eye on.

↔BB is still sideways and hasn’t made a new move higher or lower in 2 weeks, right now it is keeping packer profits just over $5 which is still slightly negative but might see a steady cash trade this week

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