Corn futures continue to see weakness. December corn saw a swift recovery in response to the June production and stocks reports but found resistance two days in a row at $3.63. That turned out to indeed be a double-top, and prices have retreated in short-order. The market is now consolidating just above support at $3.30. The chart gap between $3.42 and $3.43 ¾ will be the first level of resistance in the event of a rebound. Weekly export sales were strong, with 220,600 metric tons sold for 19-20 delivery, and 2.327 million metric tons sold for 20-21 delivery.
Soybean futures have been on a wild ride the past couple of weeks. In recent days, November has been capped by resistance at $9. A close above that level could see a retest of the recent high of $9.12 ½. Major support at $8.60 looks solid for the time being. The November contract will have resistance in the $8.90 area and then at the chart gap between $9 and $9.03. Weekly exports gave the bulls a boost today, with 365,200 metric tons of old-crop and 2.3 million metric tons of new crop beans sold to foreign buyers this week. An additional sale of 132,000 metric tons to China marked the 7th sale to China in 8 days.
The cotton market has been making a slow and steady recovery since the pandemic decimated demand for cotton. The USDA June acreage report added strength, as US acres were estimated at only 12.185 million. That recovery has now stalled out thanks to poor demand on the export market and continued weakness in retail sales. Weekly exports reported today were actually negative as cancellations outpaced sales. December is now trading in a narrow range between support at 61 cents and resistance at 65 cents.
We have known for months that the rice crop would be much bigger than last year’s, but the market reacted negatively anyway to the June 30 acreage report. U.S. acreage was pegged at 2.870 million acres, up 23,000 acres from the March prospective plantings report despite a wet spring and a late start to the planting season. Arkansas’ crop is estimated at 1.431 million acres, of which 1.25 million is long grain. The reaction to the report was obviously negative. The September contract has backed away from resistance at $12.40 but has found support at $11.70.
Live cattle futures reached new 4-month highs last week, but October failed to close above $107. That level now becomes resistance. Price action late in the week looks negative, with August charting a bearish reversal on Thursday, indicating the recent rally has run out of steam. Futures are currently trading a large premium to cash prices, and that could result in additional weakness.
Hog futures have stabilized for now. The contract low of $46.47 is now support for October. Resistance is developing around $52, but it looks likely that a long-term low has been charted. Large supplies of heavy-weight hogs are likely to limit the upside for the next couple of months as packers work through the backlog that developed when plants closed due to COVID-19.