Technical Buying Supports Wheat and Soy
Feb 14, 2014
Good Morning! Paul Georgy with early morning comments for February 14, 2014 at 4:45 am.
Grain futures are steady to higher led by the soy complex. We are seeing follow through buying in soybeans and wheat after closing above key resistance levels on Thursday.
The USDA Baseline data was released and they are going to be using a 165.6 yield for corn and 45.2 yields for soybeans as trend yield on upcoming supply and demand reports. They suggested planted acreage would be 93.5 million acres to corn and 78.0 million acres to soybeans.
The weekly export sales data showed a net increase in soybean sales which was enough to ignite buying in the soybean complex. Technical buying was also a catalyst once prices moved through the 13.40 area in the March contract at the CME. Traders will be watching the news wires at 8:00 am for any further announcements of cancellations by China.
Farmer selling of soybeans picked up yesterday which caused basis to come under pressure. Corn sales were steady but nowhere near the volume seen in soybeans.
In an interview with Reuters, Bunge CEO says they will not handle corn containing new GMO traits unless approved by China.
The Buenos Aries Grain Exchange has lowered the Argentine corn production to 23.5 mmt compared to last year of 27.0 mmt and USDA’s estimate of 24.0 mmt.
Grain markets are closed Sunday night and Monday and will open at 7:00 pm Monday evening.
Pork production last week was well above year ago levels while hog numbers were down due to heavy weight. The more seasonal weather in the forecast could help producers get current. Some are suggesting heavy weights are not a current issue but a PEDv issue. With less replacement pigs available, producers are profiting by putting on more weight. The weekly increases of PEDv cases have traders and producers concerned about summer hog supplies. Pork cutout values were up 1.20 on Thursday.
A few cattle traded at 142 while futures markets gathered support from outside influences such as weaker dollar. The price relationship of cash to futures allows room for a rally based on historical patterns. Beef cutout was slightly higher with choice up .05 and select up .13. The CME Feeder Index is 170.99.
We have several meetings scheduled for next week. Monday, Steve Georgy will be in Davenport, NE and I will be in Watertown, SD. On Tuesday we will be in Mankato, MN and Wednesday in Marshfield, WI. Call today to save a seat at 800-262-7538 or register online. Looking forward to meeting many of you in person.
Markets as of 4:45 AM
- Mar Corn + 1/4
- Mar Beans +8
- Mar Wheat +6 1/4
- Apr Cattle +.02
- Apr Hogs +.42
- Mar Dlr -.18
- Mar S&P +0
- Mar Crude -.46
- Apr Gold +11.80
Chart of the Day
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