In the News

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WEEKLY COMMODITY HIGHLIGHTS

Nearby Futures	Weekly Change	Friday's Close	Year Ago
Corn	+0.0750	3.8300	3.5100
Soybeans	+0.2600	9.2150	9.6775
Wheat	+0.0550	5.1700	4.3400
Cattle	-2.25	121.93	122.25
Hogs	+1.30	61.95	71.38
Cotton	+0.33	72.52	79.25
Milk	+0.07	14.74	13.62
Crude Oil	+2.90	48.23	62.01

Grain and oilseed futures were higher on the week, gaining on a growing recognition of soybean crop losses in Brazil and optimism about U.S.-China trade. News of meetings planned for this week between U.S. and Chinese officials helped to drive that optimism. Soybeans posted the biggest gains on the week, despite the lack of confirmation of any further Chinese soybean purchases. Meanwhile crop estimates for Brazil have started to decline significantly due to drought damage in southern Brazil in December, although even with a reduced crop world supplies will remain comfortable. Cotton futures ended the week slightly higher after making a one-year low, and wheat futures were higher on outside market support. Fundamentally, there's a lot of uncertainty in the grains complex right now. Traders remain in the dark about recent U.S. export sales and possible export sales to China due to the federal government shutdown, and the indefinite postponement of the Jan. 11 USDA reports will only add to the uncertainty in the market. There is also no CFTC data on commitments of traders to give us a picture of how speculators and commercials are positioned in the market.

In the livestock complex, live cattle futures started the new year in retreat, falling from recent contract highs under pressure from speculative liquidation and concern about the economy. The market appears to have made a significant short-term high. Plains cash trade meanwhile was steady with the prior week, which was a mild disappointment. Packer margins are contracting, and with ample market-ready cattle supplies and mild weather forecast for the Plains, near-term upside looks to be limited. Lean hog futures rallied on renewed concerns about African swine fever in China. That is going to remain a potentially explosive market factor in 2019. U.S. supplies, however, are ample.

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