How Will Traders Want to be Positioned for the Weekend?
Apr 25, 2014
Good Morning! Paul Georgy with early morning comments for April 25, 2014 at 4:30 am.
Grain futures are higher in a light volume session.
Spreading remains a factor in Ag markets during recent sessions. China trying to resell several of cargoes of soybeans continues to pressure cash prices in the export market.
Allendale Meteorologist Ryan Martin says, "Showers and thunderstorms have started in the Corn Belt, with moisture moving into the western half of the belt overnight. We still like half to 2 inch rain totals over the region, with coverage at 80% through tomorrow." Full Story
The Ukraine/Russia situation is heating up with more shootings as Ukraine take back some of the check points from pro-Russian militants. When will Putin take action? When will he believe he has to step in to protect the Russian speaking people in Ukraine? Headline traders will be keying off of any new developments over the weekend and when trade begins on Sunday night.
Reuter’s interview with a grain a analyst from Ukraine suggests wheat crop is doing well with a few areas needing moisture. He was questioned about corn planting and his forecast for Ukraine’s maize production. Their forecast is looking for a slight decrease in acres planted but the real effect could come from less fertilizer being applied.
Next week the winter wheat crop tour will begin in Kansas. Traders are anticipating some very poor findings.
The Australian Government Bureau of Meteorology released a report stating, "The likelihood of El Niño remains high, with all climate models surveyed by the Bureau now indicating El Niño is likely to occur in 2014. Six of the seven models suggest El Niño thresholds may be exceeded as early as July."
Statscan said that the Canadian farmer is expected to plant 4.8% less wheat in 2014 and plant .7% less canola in 2014. Flax and Pea seeding are expected to significantly greater than last year.
May grain options go off the board today.
Retailers prepare for one of the biggest meat demand weekends of the year (Memorial Day). With tight meat supplies of beef, pork and poultry, retailers are going to plan ahead. Although beef supplies are expected to increase going into the summer months, the uncertainty of pork supplies provides underling support. Beef cutout prices are firmer with choice up 1.16 and select up 1.40. Packers have been quiet this week but should be much easier to work with due to the improvement of cutout values. The CME Feeder Index is 178.98. Trade estimates for this afternoon’s Cattle-on-Feed report are:
Ranges Average Mln Head
On feed April 1 99.0-100.8 100.2 10.946
Placements in March 95.3-104.0 100.8 1.899
Marketings in March 95.0-98.8 96.4 1.662
Lean Hog futures are extremely volatile as we have seen this week due to money flow and uncertain supplies. Pork cutout values are down .71.
Markets as of 4:30 AM
- May Corn +2 1/4
- May Beans +5 3/4
- May Wheat +4
- Jun Cattle +.62
- Jun Hogs -.20
- Jun Dlr -.10
- Jun S&P -2.75
- Jun Crude -.62
- Jun Gold +3.60
Chart of the Day
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