Report Week Provides Hope For Bounce
Jun 09, 2014
Good Morning! Paul Georgy with early morning comments for June 9, 2014 at 4:30 am CDT.
Grain futures are mixed. Corn and soybeans are lower on good weather for crop production across the Midwest. Wheat is higher as bargain hunters provide support.
Traders will focus on this week’s USDA reports, later today the Weekly Export Inspections at 10:00 am and Weekly Crop Conditions at 3:00 pm. On the inspections report trade will be watching the old crop soybean shipments, analyzing the likely-hood of USDA hitting the soybean ending stocks target.
Crop conditions on corn should improve over last week as trade estimates range from 78 to 80% good/excellent. Soybean conditions are expected to start out the year above 70%.
The weather forecast is for alternating rain followed by sunshine across the Midwest through June 23. Weekend rains were beneficial for the growing crop with 75% of the production area getting measurable precipitation.
Traders will be adjusting positions going into the June USDA Supply and Demand report which will be released on Wednesday at 11:00 am.
The CFTC Commitment of Traders report showed managed money reducing long positions in the grain and soy complex. They reduced net longs in corn by 4,159 to 174,160 contracts, soybeans by 22,887 to be net long 104,150 contracts and in wheat they reduced positions by 18,678 contracts to be about even.
World and economic news for the week ahead includes Thursday’s ECB monthly report and Thursday’s Eurozone April Industrial Production report (expected +0.4% m/m). The Bank of Japan, on Friday, will announce the outcome of its 2-day policy meeting. Ukraine’s new president, Petro Poroshenko, who was sworn in this past Saturday, said violence must end this week as talks begin.
Feedlots are feeding cattle longer and to a heavier weight before replacing them with high priced feeders. Cost of gain to heavier weights is still profitable. Placement of feeder cattle today when using deferred futures prices would be locking in a loss. Beef values were lower on Friday with choice down .13 and select down 1.03. CME Feeder Index is 195.61.
With cash hogs closing out the week on a firm note and product higher, traders are getting renewed hope that the tight supplies are upon us. Pork cutout values were up 2.39. Expect futures to start steady to higher this morning.
Markets as of 4:30 AM CDT
- Jul Corn -4 1/2
- Jul Beans -4 1/2
- Jul Wheat +1 1/2
- Jun Cattle Steady
- Jun Hogs Steady-Higher
- Jun Dlr +.05
- Jun S&P -2.00
- Jul Crude +.55
- Jun Gold +2.90
Chart of the Day
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