By: NATHAN STUEDLE
GRAINS:
March corn closed up 3 1/4 cents and May corn was up 3 cents. January soybeans closed up 4 cents and March soybeans were up 5 1/2 cents. March KC wheat closed up 6 cents, March Chicago wheat was up 5 3/4 cents, March Minneapolis wheat was up 1 cent.
With the winter season officially underway, row crops kicked off Christmas week with a subdued trading session which saw mostly higher prices. Higher energy futures were the primary bullish driver for Monday with crude oil futures up for a fourth consecutive session and after hitting almost five-year lows last week, on renewed geopolitical risk premium as the U.S. has seized two Venezuelan oil tankers and is reportedly pursuing a third to start the week. Also adding to the unease is heightened Russian attacks on key Ukrainian export infrastructure, at least temporarily giving pause to what had been growing hopes for peace in that area. This gave a boost to vegetable oil markets to start the week, with soybean oil posting just the third positive session out of the past ten.
LIVESTOCK:
Following last week's bullish Cattle on Feed report and somewhat bullish fed cash cattle trade, the live cattle contracts traded higher into Monday's closing bell and are again trading alongside the market's 100-day moving average. Traders would like to conquer that threshold, but without knowing for sure how much fundamental support is going to remain in the market, given that it will be a holiday-shortened week both this week and next, traders remain cautious about breaking through that barrier right now. It is helpful to note boxed beef prices were higher again today, showing ample consumer support heading into the Christmas holiday. New showlists appear to be mixed, higher in Texas and Kansas, but lower in Nebraska/Colorado. Last week Northern dressed cattle traded at mostly $355 to $358, which is $2.00 to $4.00 higher than the previous week's weighted average, but Southern live cattle traded at mostly $228, which is $2.00 lower than the previous week's weighted average.
Today is the first chance that traders have had to fully react to Friday's bullish Cattle on Feed report, and they boldly continued to push the feeder cattle contracts higher, incrementally moving the contracts past the 100-day moving average. Given the strong note of higher boxed beef prices this morning, and the higher trend in the live cattle contracts, it's likely that the market will be able to maintain this rally through the day's close.
The lean hog contracts traded slightly higher into Monday's close as traders are hopeful that more support will develop and allow the contracts to trade above the resistance at $90.00. Do note that on Tuesday (tomorrow), the Quarterly Hogs and Pigs report will be released.