Corn: Neutral 1. Market Focus: Market participants previously anticipated the release of 20 million tons of targeted rice reserves starting in April, which has yet to materialize, creating a supply-side expectation gap that provides significant support for bullish positions. Concurrently, spot market prices have risen sharply, but delivery volumes have not kept pace. The upcoming new-season wheat harvest will offer some substitution pressure. By May, corn will gradually enter a phase of inventory drawdown ahead of the new season. Hog herd levels have not shown significant reduction, maintaining feed demand, while previously deferred restocking needs are providing temporary support, leading to range-bound fluctuations in the front-month corn contract. 2. View Summary: Feed inventories for both soybean meal and corn are at yearly lows, with feed mills generally maintaining a hand-to-mouth purchasing strategy. The sustainability of spot price increases is questionable, presenting a risk of correction within the week. Support is seen at 2,380 yuan/ton, with no clear resistance level above.
Soybean Meal: Neutral 1. Profit-taking by long positions led to an overnight decline in CBOT soybeans. The broader agricultural sector rose yesterday, primarily driven by persistent geopolitical risks, marginally increasing inflation expectations, and market anticipation of potential El Niño disruptions to crop yields. Medium-term, a summer El Niño could reduce drought probability in the U.S. Midwest, potentially boosting yields, which may limit the weather-related premium in U.S. markets. 2. Dalian soybean meal followed U.S. markets higher but gains were capped by pressure from arriving South American soybean shipments. The short-term outlook suggests continued wide fluctuations. View Summary: A range-trading approach is advised. Monitor the performance of the September contract within the 3,000-3,050 yuan/ton range.
Eggs: Neutral to Bearish Spot prices in major producing areas declined, with Hebei Guantao's spot quote at 3.49 yuan/jin, down 0.04 yuan/jin from the previous day. With pre-Labor Day restocking nearing its end, spot prices are showing signs of weakness. A faster pace of aging hen culling offers temporary support. However, medium-term pressure remains significant, as the current laying hen inventory is high year-on-year, and previous increases in chick placements will translate into higher egg production from June to July. Post-holiday consumption is expected to soften, and the approaching Southern rainy season may impact logistics and storage, limiting upside for distant contracts. View Summary: Short-term spot price increase drivers are largely priced in. For near-month contracts, consider range trading around support levels; long positions should watch for profit-taking opportunities. For distant contracts, monitor chances to sell on rallies.
Hogs: Neutral Spot hog prices retreated. The average price in major producing regions was 9.58 yuan/kg yesterday, down 0.10 yuan/kg from the previous day. After a recent sentiment-driven recovery, the front-month contract 2607 is approaching the cost range for purchasing piglets for fattening, between 11,500 and 12,000 yuan. With open interest in the 2607 contract exceeding 210,000 lots, significant volatility is expected near the cost line as bulls and bears contend. Latest data on newborn piglets suggest supply pressure may peak around April 2026, with potential improvement from May to June. View Summary: Existing long positions may consider taking some profits on rallies. Sellers could wait for better entry points or consider selling deep out-of-the-money call options on the July contract.
Risk Disclaimer: This analysis is prepared by the futures company's research and development team. Information is sourced from publicly available data. While accuracy is pursued, no guarantee is made regarding completeness or reliability. Trading based on this information is at one's own risk. This report does not constitute personal trading advice and may not account for individual objectives, financial situations, or needs. Clients should assess suitability independently.
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