WEST DES MOINES, Iowa – Tensions between Ukraine and Russia persist as concerns on weather effects to the South American crop are supporting soybeans. Today’s analyst is U.S. Commodities, Inc. founder Don Roose.
The corn and soybean market is continuing to have some strength during most of the day, kind of recovering from overnight, under some pressure. We still continue to be dominated by the issue between Russia and Ukraine, although that has very much cooled down as Russia has moved troops out of the southwest part of Ukraine, but we still have the occupation in the Crimea region, so that’s a little bit of the issue.
So, I think the bottom line: we’re adding some risk premium to the market for the concern with the grain trade in the whole Black Sea Region.
The soybean market continues to find some strength – that’s really not an area, out of the Ukraine area, that’s a big marketer of soybeans around the world. It’s more corn and wheat.
But on the soybean front we continue to be concerned about the size of the South American crop it has shrunk some, it’s not a big issue but just enough to put an upward bid into the market but the Chinese continue to be underneath the market, supporting the bean market, although it looks like their ports are getting congested with the supplies of soybeans. So I would say today continues to be more of technical buying, a little bit of risk premium, in case things in the Ukraine-Russia situation deteriorate.
The cattle market again a very strong day, new highs in many of these months – the contract highs.
The strength continues to be from the cash market. It’s very strong. We traded cattle last week at $152, $152 and a half. The futures market is a discount, so it’s very hard for the market to break. The box beef is very strong; it’s a strong day in the cattle market.”>
Same thing with the hogs; all time highs in the hog market as we continue to soar to new levels on a concern with the PED virus and confidence that we’re going to see the slaughter start to drop any time in this area, and you know, the pork values are finding strength.
So the meat markets are all about supply shrinking and “can we sell the meat at the counter?”