Pure Hedge – Livestock and Grain

Bill AllenGeneral Commentary Leave a Comment

10/28/24

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 The Livestock Markets were all higher today. December’24 Live Cattle were 12 1/2 cents higher today and settled at 189.27 1/2. Today’s high was 189.42 ½ and the 1-month high is 189.50. Today’s low was 188.45 and the 1-month low is 183.97 1/2. Since 9/27 December’24 Live Cattle are 4.80 higher or more than 2 1/2%. The Feeders were more than a buck higher today. January’25 Feeder Cattle were 1.32 1/2 higher today and settled at 246.95. Today’s high was 247.05 and the 1-month high is 248.52 1/2. Today’s low was 244.75 and the 1-month low is 235.85. Since 9/27 January’25 Feeder Cattle are 7.35 higher or just over 3%. The Hogs were higher again as well. December’24 Lean Hogs were 95 cents higher today and settled at 80.62 ½. Today’s high was 80.82 1/2 and that is the new 1-month and 52-week high as well. Today’s low was 79.20 and the 1-month low is 72.40. Since 9/27 December’24 Lean Hogs are 7.25 higher or almost 10%. If/When the Cattle markets break from here, it will break quickly again. The Funds bought more than 4,500 Contracts on Friday, before the Cattle on Feed Report and are now long more than 90,000 contracts. I still think the Report was Bearish, but the Dow Jones Index was about 300 points higher when the Livestock Markets closed today, and the December’24 Fats were just able to stay in the Green and settled up 12 ½ cents for the day. Israel’s response Friday night was not enough to shock the Stock Markets, but Crude Oil was hit hard. Today, Iran said it will use all available tools to respond to Israel’s attack. So, this might not be over, and next time Israel responds I think it will be massive. Anyway, for one reason or another I feel the Cattle Markets are heading lower. I recommend buying any Corn feed needs now as well. The feedlots are still full, and with the expanding drought, more Cattle could be placed in the feedyards. Corn is cheap, and the Cattle can put on above average weight again fast. There is always still the demand issue, and can the Packers keep paying up, without the demand decreasing? The big worry should be with the Funds, and when they decide to liquidate and take profit. It never seems to happen when you expect it. If you would like more information, please use this link Sign Up Now I am still Bearish the Cattle Markets for all the same reasons and think we will see a pullback in the Market soon. 

     The Grains were all lower today. November’24 Soybeans were 13 3/4 cents lower today and settled at 974. Today’s high was 985 1/2 and the 1-month high is 1069 ¾. Today’s low was 973 1/2 and the 1-month low is 968 1/4. The 52-week low is 955. Since 9/27 November’24 Soybeans are 91 3/4 cents lower or more than 8 1/2%. The Corn Market dropped as well today. December’24 Corn was 4 1/2 cents lower today and settled at 410 ¾. Today’s high was 414 3/4 and the 1-month high is 434 ¼. Today’s low was 410 and the 1-month low is 399. The 52-week low is 385. Since 9/27 December’24 Corn is 7 ¼ cents lower or almost 2%. The Wheat Market slid lower again today. December’24 Wheat was 10 ½ cents lower today and settled at 558 3/4. Today’s high was 571 ½ and the 1-month high is 617 ¼. Today’s low was 557 3/4 and that is the new 1-month low. The 52-week low is 520 ¾. Since 9/27 December’24 Wheat is 21 ¼ cents lower or more than 3 1/2%. The Beans continued to head lower again today, because they should. November’24 Soybeans traded down to 973 1/2, just 5 ¼ cents from the 1-month low of 968 ¼. I still think the November’24 Beans will trade down to and through the 52-week low of 955 and could get down to the 920 level. I still recommend selling the March’25 Soybeans and buying the August’25 Soybeans in the Option Markets. I have a few great Option Trades in August’25 Beans that will capture any move higher if there are problems with Brazil’s planting now, their growing season and their harvest, along with US plantings and part of the growing season. With the US drought continuing to expand, August looks like a good trade to me. The Corn Market looks like a buy here. I think it can trade higher from here, and the downside risk is minimal I feel. This is a good time to lock in any feed needs. I think the December’24 Corn can test the 435 level again, and if it gets through, I feel it can be at the 450 level quickly. That would put the December’24 Wheat around the 640 level. Those price levels are both 50% retracement levels from the 52-week High/Low. There is real demand for Corn, and I feel it will be heading higher soon, it is already detached form the Soybean Market I believe. The Brazilian Bean crop is quickly being planted now, and they are receiving plenty of rain, and is on schedule to be a record crop. If you would like more information, please use this link Sign Up Now I am still Bullish the Soybean Oil and Canola Oil Markets for the next few months. They have both been on a run higher, and I think those Markets pulled back today following the rest of the Grain Complex lower. 

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Today’s Brazil Weather Radar Map

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-Bill

312-957-8079

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Bill Allen

Senior Account Executive

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ballen@walshtrading.com

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