Pure Hedge - Livestock and Grain

9/23/24

     Today was an opportunity to sell at much higher prices, you pick the Market, and I hope you took advantage of it. The Livestock Markets were all higher today. December'24 Live Cattle were 62 ½ cents higher today and settled at 183.82 ½. Today's high was 184.47 ½ and that is the new 1-month high as well. Today's low was 182.82 ½ and the 1-month low is 173.50. Since 8/23 December'24 Live Cattle are 8.62 ½ higher or almost 5%. The Feeders were up as well. October'24 Feeder Cattle were 57 ½ cents higher and settled at 244.47 ½. Today's high was 245.17 ½ and the 1-month high is 245.30. Today's low was 243.00 and the 1-month low is 229.57 ½. Since 8/23 October'24 Feeder Cattle are 10.10 higher or more than 4%. The Hogs climbed higher as well. December'24 Lean Hogs were 65 cents higher and settled at 74.87 ½. Today's high was 75.15 and that is the new 1-month high as well. Today's low was 74.12 ½ and the 1-month low is 70.00. Since 8/23 December'24 Lean Hogs are 4.12 ½ or almost 6%. The Cattle on Feed Report was last Friday, and it did not have any big surprises. I think the continued rally in the Cattle Markets today was simply ending a technical bounce. It was not a big rally in the Cattle Markets either, as both the Fats and Feeders closed less than a dollar higher on the day. December'24 Fats were 62 ½ cents higher but settled $1.65 below the highs. October'24 Feeders were 57 ½ cents higher but settled $2.17 ½ below todays highs. It was not a very strong close. Last week the Cattle weights were up again at 855 pounds, up 3 pounds from the week before, and 26 pounds more than this time last year at 829 pounds. The 5-year average is 831 pounds. Last week's slaughter numbers were small. 108,000 last Friday and 9000 on Saturday, brought the total for the week to 610,000. That is the smallest slaughter for the week in 8-years. For the same week last year, the slaughter was 626,639. Last week's cash trade averaged $184.01, $1.90 higher than the week before. Packer's margins are back in the red again, so bids may start to decline again. I still feel there is a good chance for the Cattle Markets to turnaround again. 

     The Grain Markets were all much higher today, and the Beans were an easy sell. Soybeans led the way higher today. November'24 Soybeans were 27 ¼ cents higher today and settled at 1039 ¼. Today's high was 1041 ¾ and that is also the new 1-month high as well. Today's low was 1012 and the 1-month low is 960 ½. Since 8/23 November'24 Soybeans are 66 ¼ cents higher or almost 7%. The Corn looked strong today. December'24 Corn was 11 ¾ cents higher today and settled at 413 ½. Today's high was 414 ¼ and the 1-monthhigh is 416. Today's low was 401 ¼ and the 1-month and 52-week low is 385. Since 8/23 December'24 Corn is 22 ½ cents higher or almost 6%. The Wheat bounced back as well. December'24 Wheat was 14 cents higher today and settled at 582 ½. Today's high was 586 ½ and the 1-month high is 598 ¾. Today's low was 569 and the 1-month and 52-week low is 520 ¾. Since 8/23 December'24 Wheat is 54 ½ cents higher or more than 10%. The Beans shot higher today on a combination of the funds unwinding some of their short positions, as open interest shrank after October's expiration, and the potential wet weather coming to the Midwest, along with the continued lack of rain in Brazil. I feel today was a good day to sell some Beans. Soybean harvest is underway and is about 3% ahead of last year's harvest. Soybean Crop conditions are 64% Good/Excellent, compared to 50% last year, and Poor/Very Poor is 11% compared to 18% last year for select States. China has been buying some Soybeans, but it's not enough. Soybean inspections YTD are about 6% below last year. The tariffs on China's EV's go into effect this Friday the 27th, and they could respond or retaliate by putting tariffs on the US agricultural sector, staring with Soybeans, or just stop buying them altogether. There is a WASDE Report next month on the 11th, just 13 trading days away. If the yield changes, or if the ending stocks change it will be a large market mover. The USDA has Soybean yield at 53.2 bushels per acre and ending stocks at 550mb. If the numbers are closer to Pro Farmers estimates of 675mb ending stocks, the Market will react quickly. If the Soybean rally today was based more on the dry weather in Brazil, then any rain moving into that area, could send the Market down faster than it climbed today. At the beginning of last week, Brazilian Soybean planting was 2.3% ahead of last year. This year Brazil is also planning on planting 3% more Soybeans, with a production increase of more than 12% compared to last year. The monsoon rains are projected to arrive in early October. I am still Bearish the Soybean Market, and I sold calls and bought puts late in the day, and I recommend selling March'25 Soybeans as well. 

-Bill

312-957-8079

I have market commentary and option charts in 

Pure Hedge – Livestock

Pure Hedge – Grain   

at WWW.WALSHTRADING.COM 

Listen Live at 7:25am on 

WWW.KDHNRADIO.COM 

Tuesday-Friday

Call for specific trade recommendations.

1-312-957-8079 

Email me for free research. 

BAllen@walshtrading.com 

Bill Allen

Senior Account Executive

Direct:      1 312 957 8079

ballen@walshtrading.com

WALSH TRADING INC.

311 South Wacker Drive

Suite 540

Chicago, Illinois 60606

www.walshtrading.com

Walsh Trading, Inc. is registered as a Guaranteed Introducing Broker with the Commodity Futures Trading Commission and an NFA Member.

Futures and options trading involves substantial risk and is not suitable for all investors. Therefore, individuals should carefully consider their financial condition in deciding whether to trade. Option traders should be aware that the exercise of a long option will result in a futures position. The valuation of futures and options may fluctuate, and as a result, clients may lose more than their original investment. The information contained on this site is the opinion of the writer or was obtained from sources cited within the commentary. The impact on market prices due to seasonal or market cycles and current news events may already be reflected in market prices. PAST PERFORMANCE IS NOT NECESSARILY INDICATIVE OF FUTURE RESULTS. 

All information, communications, publications, and reports, including this specific material, used and distributed by Walsh Trading, Inc. (“WTI”) shall be construed as a solicitation for entering into a derivatives transaction. WTI does not distribute research reports, employ research analysts, or maintain a research department as defined in CFTC Regulation 1.71.

Disclaimer: The copyright of this article belongs to the original author. Reposting this article is solely for the purpose of information dissemination and does not constitute any investment advice. If there is any infringement, please contact us immediately. We will make corrections or deletions as necessary. Thank you.