Will Funds Return As Buyers Today?
Feb 19, 2014
Good Morning! Paul Georgy with early morning comments for February 19, 2014 at 4:35 am.
Grain futures are trading in a very narrow range. Will managed money funds be back as buyers today after the risk-on activity that we saw yesterday?
Reporting from Marshfield, WI this morning where we have another meeting for Legend Seeds at 10:00 am at the KC Hall. We have had great turnout by producers in our 2 previous meetings with some very interesting conversation and are looking forward to another successful meeting today.
The weaker dollar and the lack of cancellations in soybeans by China had bears running for hibernation yesterday. There also was a weather forecaster calling for drought this summer which provided fuel for buyers.
Soybean basis was lower in the West where weather is not affecting movement. However eastern processors raised bids to get soybeans as producers fight ice and snow to move grain.
Funds were large buyers on Tuesday when they bought a net 10,000 corn, 11,000 soybean, 7,000 wheat, 4,000 soymeal and 6,000 soyoil contracts.
Agriculture Canada expects farmers to plant 8% more canola and 6% less wheat this year. They also expect production of both to fall as yields return to normal.
USDA Ag Forum and Outlook will be releasing their first estimates for the 2014/15 crops in a presentation on Friday.
Cash cattle are expected to trade higher this week even with packer’s margins running over $125 in the red. Supplies of market-ready cattle are still tight. Beef cutout values were higher on Tuesday with choice up 1.01 and select up 1.70. The CME Feeder Index is 171.64.
Lean hog futures are getting support from firmer cash prices but mainly due to fund or outside buying. The pig loss due to PEDv is continuing to provide support to summer contracts. The pork cutout values were up .52.
Markets as of 4:35 AM
- Mar Corn – 1/2
- Mar Beans +0
- Mar Wheat + 1/2
- Apr Cattle -.22
- Apr Hogs +.07
- Mar Dlr -.01
- Mar S&P -4.25
- Mar Crude +.18
- Apr Gold -5.50
Chart of the Day
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