Can Demand Support A Rally In Grains?
Nov 11, 2013
Good Morning! Paul Georgy with early morning comments for November 11, 2013 at 4:50 am.
Thanks to our veterans and all the US troops protecting us around the world on this Veterans Day.
Grain futures are mixed as corn and wheat are higher on short covering and profit taking in soybeans after Friday’s rally. Spreading is a factor to watch also many financial markets are closed today for the holiday.
After a weekend to crunch the USDA numbers, traders will be making position adjustments this week. Corn futures rallied on Friday but ended the week unchanged.
Harvest progress this afternoon is expecting corn to be 82 to 85 % complete and soybeans 90 to 92% done. The weather forecast is for another cold front to move south and provide some snow across the central Midwest by midweek.
South American weather should be favorable to getting the row crops off to a good start. Argentina is expected to be over 50% planted.
The CFTC Commitment of Traders report on Friday afternoon showed managed money slightly reducing short positions in corn to 178,720 contracts short. They reduced long positions in soybeans by 18,793 and went from a net long to a net short position in wheat after selling a net 32,474 contracts.
Traders are looking for the EPA to make a decision on the ethanol mandate this week. The results could weigh on the corn market after a technical short covering rally.
The rally in futures caused soybean and corn basis to work lower late last week on a pickup in farmer selling.
Cash cattle traded at 131 last week. Packers were meeting their needs with contracted cattle. Beef cutout values were lower with choice down 1.20 and select down .43. Retailers will be featuring turkey the next several weeks, taking counter space of pork and beef. Pork cutout values were up .79 on Friday. Technical support crosses at last week’s lows in both cattle and hogs.
Markets as of 4:50 AM
- Dec Corn +5
- Jan Beans – 1/2
- Dec Wheat +4 1/4
- Dec Cattle steady-lower
- Dec Hogs steady
- Dec Dlr -.18
- Dec S&P +1.50
- Dec Crude -.20
- Dec Gold -.80
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