Weather Now Becomes Driver
Apr 01, 2014
Good Morning! Paul Georgy with early morning comments for April 1, 2014 at 4:45 am.
Grain futures are mixed with corn and soybeans higher, wheat lower. Follow through buying and the weather forecast are seen as the drivers this morning.
The USDA report is now behind us and it provided a large trading range on Monday. Technical traders are focused on the large outside day in corn and soybeans.
Planting intentions has analysts scratching their heads on why the USDA does not expect all the available acres to be planted this year. The data we have to use from now until the June Plantings report will open the opportunity for headlines as weather impacts planting conditions.
The USDA quarterly stocks report was not far from what traders were expecting. The USDA will use the stocks numbers that were released yesterday in the April Supply and Demand Report. Soybean supplies will be extremely tight while corn should see further reduction in ending stocks.
Funds now have nothing to stop their buying. They bought a net 20,000 corn contracts, were even in wheat and bought 11,000 in soybeans on Monday.
Turning the calendar to April means weather forecasts will be watched closely. The current forecast for cooler/wet conditions over the next 10 days continue is providing underlying support for row crops.
The Ukraine/Russia situation is being watched very closely by grain traders as spring planting begins in Ukraine.
Wheat crop conditions dropped for the third straight week in Kansas while OK and TX hold week ago levels.
Hog futures were impacted Monday by the bearish Hogs and Pig Report. Many traders believe it may take a few reports before they get the hog supply right. Nearby pork demand is strong and supplies are tight. The pork cutout value is up 1.26.
Cattle traders are struggling with the discount of futures to cash versus the expectation market ready supplies will increase into summer months. Beef values are weaker with choice down .67 and select down 2.33. CME Feeder Index is 177.60.
Markets as of 4:45 AM
- May Corn +1 1/2
- May Beans +13 3/4
- May Wheat -10
- Apr Cattle -.07
- Apr Hogs +.12
- Jun Dlr -.05
- Jun S&P +3.00
- May Crude -.28
- Apr Gold +3.20
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