Stage Is Set For Wild Week Ahead
May 02, 2014
Good Morning! Paul Georgy with early morning comments for May 2, 2014 at 4:40 am.
Grain futures are mostly higher as markets try to take back some of yesterday’s losses.
Technical traders will be watching the 14.60 area as support. A close below that level could trigger more selling.
The weather forecast has given producers a bigger window to plant at least south of I80. Planting progress estimates from the USDA on Monday afternoon will be watched very closely as we start the week.
Traders are already concerned about the yield numbers USDA will use on the May 9th Supply and Demand Report. Rich Nelson has done a study on what the USDA may do to corn yields based on late plantings. Details will be available next week.
Traders around the world will be back to work today. Yesterday was May Day in countries such as China and Argentina. We are still waiting for news or confirmation of China cancelling shipments of soybeans. The Weekly USDA Sales Report on Thursday showed the first net cancellations for soybeans.
Crop tour puts Kansas wheat yield forecast at 33.2 bushels per acre vs 5 year tour average of 41.8, actual last year was 38.0 bushels per acre. Total production for Kansas is seen as 260.7 million bushel.
Outside markets are waiting for the Unemployment numbers at 7:30 and the Factory Orders data which will be released at 9:00.
Competition at the retail counter has hog traders concerned about how much pork demand is affected by high prices. Fund buying and selling (money flow) has had an impact on futures prices this week. We expect volatility to continue for some time as the trade deals with PEDv effect on hog supplies. Pork cutout values were down 2.02 on Thursday.
Feeder cattle futures jumped as warmer weather and recent rains ignited demand at auctions. Cattle buyers are looking for light weight animals to put on pasture. Cheaper corn prices improve profit potential and is the reason for buying enthusiasm of feeder cattle. Beef cutout values are weak with choice down 2.76 and select down 1.31. The CME feeder Index is 179.03. Can cattle close strong for the week?
Markets as of 4:40 AM
- Jul Corn +2
- Jul Beans +1
- Jul Wheat +6 1/2
- Jun Cattle +.05
- Jun Hogs -.35
- Jun Dlr +.04
- Jun S&P +1.50
- Jun Crude +.47
- Jun Gold +1.40
Chart of the Day
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