Markets Now with Michelle Rook

Grain and livestock futures all end in the red on Friday with risk off selling.  Garrett Toay, AgTraderTalk, says it was tied to bearish outside markets and a selloff in the stock market and crude oil.  Grains also saw profit taking after a decent rally off the lows and after hitting chart resistance.  He thinks grains may trade sideways now until the USDA Report provides direction on yield and with harvest about to ramp up.  Cattle futures had a tough day and a down week following lower cash and cutouts and he thinks a bigger correction is in store.  Hog futures saw risk off technical selling as well and a push from lower cutouts, but he doesn't think that market is done going up yet.    

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Grains see early strength with strong new crop corn and soybean exports but then turn mixed.  Darin Newsom, with Barchart says, the markets have run into chart resistance and may be getting tired.  Plus, there may be some harvest pressure heading into the weekend.  He says the recent rally in the grains follows the seasonal patterns and while demand news and weather have been helpful, most of the push has been fund short covering.  Crude oil tries to recover after one of the worst week's in a year, but what does that mean for the ag sector?  And payroll data was lower than expected and Newsom says he expects a rate cut in the September meeting, the question will be how much.   

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Mike Zuzulo, Global Commodity Analytics, says corn and wheat set back on profit taking.  Soybeans start lower but rebound with export business to China and unknown destinations and some concerns about dryness in Brazil impacting planting.  Cattle futures have a tough technical day taking out key support but lower cash at $181 in the South also hit futures.  He says lean hogs followed cattle but also saw some profit taking with China economic concerns weighing on the market.

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Scott Varilek, Kooima Kooima Varilek, says cattle see more pressure with some early cash trade at lower money after hopes for steady, plus higher weights.  October live cattle need to hold the uptrend line technically as he says that contract is setting right on that critical point. Hog futures are down for a second day seeing profit taking and lower cutouts weigh on futures, so he thinks the rally is over.  Grains are taking a breather Thursday after a nice rally but he doesn't think its over as demand and soybean export business to China is coming to the market and there are growing concerns about the dryness in Brazil.    

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Rich Nelson with Allendale, Inc. says grains continued to rally on Wednesday with livestock leaning lower.  Funds continue to cover short positions in the grain markets but there is also a fundamental push coming from moderating yield expectations in South America and in the U.S. The U.S. sentiment was reflected in their national annual yield survey.  That combined with a pick up in demand could keep the rally going for awhile.  Cattle futures consolidate with some early lower cash at $180 in Kansas and despite strong beef values post-Labor Day.  Hog futures also set back after a strong chart breakout and push from stronger demand.  So is the rally over?  

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Grains try to build on yesterday's higher closes, while livestock are mixed.  Dave Chatterton, Strategic Farm Marketing, says the funds have been covering their short position with strong technical signals, talk of lower yield and better demand.  However, he's not sure how much farther grains can rally ahead of the WASDE and with a pick up in farmer selling.  Cattle are consolidating after a higher day yesterday and despite strong boxed beef values.  Lean hog futures continue to see managed money buying with some help from stronger cash and cutouts but he thinks the rally may be about to run out.  

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Grain and livestock futures all close higher on Tuesday.  Randy Martinson, Martinson Ag, says grains were able to technically build on higher weekly closes and with the outside market bearishness it looked like some money flowed into the ag sector or funds took some profits on their short positions. However, yield and crop conditions may be declining with the hot dry weather and the dryness persists in the extended forecast.  Demand has also been picking up with 4.85 million bushels of flash soybean sales to China and strong export inspections for all of the grains.  Cattle extended gains after a higher week last week and strong midday boxed beef prices.  Hogs continued to see fund buying with higher cutouts.  

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Grains all close higher Friday and post higher weekly closes.  Was it all fund short covering end of month or are the grain marktes changing trend?  Bryan Doherty, Total Farm Marketing, dicusses what he's watching for confirmation the markets have bottomed.  Cattle finish higher for the week, despite steady to lower cash.  So can the market build on that?  Hogs also extend gains Friday and for the week on fund buying but what are the fundamentals supporting the market?  

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Grain and livestock futures are mostly higher early Friday.  Scott Varilek, Kooima Kooima Varilek, says the cattle charts still look good if August live cattle can expire above $178 that will be very positive for the long term continuation charts.  Cash trade this week has been steady in the South at mostly $183 with some steady live sales in the North, but dressed business at $292 is $2 lower.  He is also concerned about weights running 24 pounds over a year ago with high priced feeders and four year lows in corn.  Lean hogs have had a chart breakout but can the market keep going?  Soybeans have broke above the downtrend line and corn is above its 20 day moving average.  Is this just fund short covering end of month or a real trend change?    

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Jeff Hoogendoorn with Professional Ag Marketing says grains end to the plus side with corn and soybeans adding some weather premium on hot dry forecasts and ideas of declining yield.  However, new crop exports for corn and beans were also supportive.  Wheat followed the row crops but also saw some fund short covering and he says this may be evidence the managed money want to buy in the ag sector.  Cattle set back on fund liquidation and lower cash and cutouts. Hogs continue to shine with technical buying and strong exports but Hoogendoorn warns that market is oversold.   

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