Morning Highlights


Highlights

  • Coronavirus continues to spread, with reports this morning of 81 deaths and 2,740 confirmed cases of the virus in China. The Chinese Lunar New Year holiday has been extended, and Beijing plans to extend winter break for schools. Fears of the disease have put pressure on commodities across the board.
  • A U.S. embassy in Baghdad was struck by three rockets, injuring one person.
  • Outside markets as of 7:00 AM: March crude oil down $1.50 at $52.69 per barrel, January gold up $12.50 at $1,583.60, US Dollar Index up 0.058 at 97.911, and Dow futures down 427 at 28,506.
  • Weekly export inspections will be released at 10:00 AM Central.
  • Last trading day for January feeder cattle futures and options is Thursday, January 30th.
  • The biannual cattle inventory report will be released on Friday, January 31st at 2:00 PM Central.

 Corn

  • Corn gapped lower overnight and is currently below it’s 50-day moving average of $3.83 ½. The overnight sell off is linked to the fear of Coronavirus and the impact it could have on demand.
  • Spreads: H/K 5 ¾ cent carry; K/N 5 ½ cent carry; N/U 1 cent inverse; U/Z 3 ½ cent carry.

 Outlook:  Weaker on fears of Coronavirus

 Oilseeds

  • Soybeans gapped lower overnight and broke below $9.00 on the March contract for the first time since December 6th.
  • South American weather looks favorable, which is adding pressure to U.S. soybean prices. Additionally, the Brazilian real continues to weaken this morning trading at 4.2153, up 0.0339.
  • Soyoil and soy meal were off sharply, with March at 31.04 down 0.98 and $269.00 down $2.30 respectively as of 6:45 AM Central.
  • Spreads: H/K 13 ¾ cent carry; K/N 14 cent carry; N/Q 5 cent carry; Q/X 5 ¼ cent carry.

 Outlook: Weaker on virus fears, and good South American weather

 Wheat

  • The wheat markets were weaker overnight, with Chicago the biggest loser followed by Kansas City and Minneapolis.
  • Egypt’s cabinet reported that they have enough wheat reserves to last through the end of June. The cabinet also reported they will add another 330,000 tonnes to their storage capacity.
  • Spreads: Chicago H/K 1 cent inverse; Kansas City H/K 7 ¾ cent carry; Minneapolis H/K 9 ¾ cent carry.

  Outlook: Weaker on virus fears