Ahead of the Open (VIP) -- April 21, 2014

08:15AM Apr 21, 2014
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Corn futures are called 2 to 4 cents lower amid profit-taking.

  • Corn futures ended the overnight session 2 to 4 cents lower on spillover from neighboring pits and followthrough from last week's losses.
  • May corn is hovering just above the $4.90 level and uptrending support drawn off January and March lows.
  • Fieldwork resumed across the Corn Belt over the weekend, but scattered rains in the forecast this week will delay the start of planting in many areas.
  • According to a report from the Chinese Academy of Agricultural Sciences, the country will be able to produce enough corn over the next decade to be self-sufficient.


Soybean futures are called to open 5 to 10 cents lower amid profit-taking.

  • Soybean futures ended the overnight session mostly 7 to 10 cents lower amid profit-taking, with meal and soyoil also seeing losses.
  • Bulls still hold the clear technical advantage after posting a new-for-the-move high on Friday. Therefore, key this morning will be if traders continue to take profits or view overnight weakness as a buying opportunity.
  • The Chinese Academy of Agricultural Sciences say the country will still require soybean imports over the next 10 years, but at a slower rate.
  • Otherwise, there's little fresh news for the markets to digest this morning, which could return focus to the tight old-crop soybean stocks situation.


Wheat futures are called 10 to 15 cents lower after rains fell over HRW wheat areas.

  • SRW wheat futures ended the overnight session 12 to 15 cents lower, with HRW down 10 to 11 cents and HRS down 9 to 12 cents.
  • Futures were pressured overnight after areas of the Central and Southern Plains received scattered rains over the weekend.
  • The forecast calls for more rains this week, although forecast models are not in agreement about coverage and amounts.
  • Traders generally expect this afternoon's crop condition ratings to reflect deterioration in the HRW wheat crop, while the SRW wheat crop improved.


Live cattle futures are called to open weaker in reaction to Friday's lower cash trade.

  • With no overnight trade to provide a glimpse of this morning's open, traders expect live cattle to open lower after $1 lower cash trade late on Friday.
  • Only light cash trade at $146 was reported on Friday, with April futures ending last week at around a $2 discount to those prices.
  • Traders expect the seasonal slide in the cash market to continue as packers work to improve negative profit margins.
  • Traders will also be keeping a close eye on the beef market to see if last week's strong movement carries over into this week, which would signal a near-term low is near.
  • Weakness in the corn market overnight should help limit pressure on feeder futures.


Lean hog futures are called to open steady to firmer amid cautious trade.

  • Lean hog futures are expected to see a boost from ideas packers are short bought heading into the week.
  • A shortened kill schedule last week left many packers in need of hogs to start the week, but some packers are still working on improving margins. As a result, the cash market is called mixed.
  • Pork cutout values firmed $1.20 on Friday, but movement was a light 217.63 loads.
  • Bulls have a slight upside advantage to start the week after futures posted solid gains last week and ended the week near the highs.