Ahead of the Open (VIP) -- April 25, 2013

April 25, 2013 03:15 AM

Corn futures are called to open marginally to 4 cents higher on short-covering.

  • Corn futures ended the overnight session 1 3/4 to 4 1/4 cents higher in the May through December contracts, with deferred futures up 3/4 cents.
  • Futures were supported by short-covering and weakness in the U.S. dollar index.
  • This morning's weekly export sales data showed corn sales of 314,700 MT for 2012-13 and sales of 21,200 MT for 2013-14, coming within traders' expectations.
  • Also this morning, USDA announced a 300,000 MT corn sale to China for 2013-14 and a 240,000 MT to an unknown destination for 2013-14.
  • Gulf corn basis is steady this morning to stand 65 cents above May futures.


Soybean futures are called 7 to 10 cents higher on a continuation of overnight gains.

  • Soybean futures ended the overnight session 7 to 10 cents higher on help from sharp pressure on the dollar index.
  • Ideas losses are overdone also encouraged short-covering overnight.
  • But this morning's weekly export sales data isn't supportive this morning, as it showed net sales reductions of 206,300 MT for 2012-13 and sales of 628,500 MT for 2013-14.
  • Gulf soybean basis is 5 cents weaker for immediate delivery to stand 95 cents above May futures, which reflects a softening of demand.


Wheat futures are called 2 to 5 cents higher on help from dollar weakness.

  • Chicago wheat futures ended the overnight session 2 to 3 cents higher, with Kansas City up 4 to 5 cents. Minneapolis ended 3 to 5 cents higher.
  • Wheat futures saw spillover from neighboring pits overnight, as well as help from dollar weakness.
  • But without fresh news, upside potential will be limited to short-covering as traders aren't focused on yield concerns in HRW wheat country or planting delays in spring wheat country.
  • This morning's weekly export sales data showed wheat sales of 71,700 MT for 2012-13 -- a marketing year low. Sales of 234,700 MT for 2013-14 were also a disappointment.


Live cattle futures are called to open steady to firmer on building expectations for at least steady (if not firmer) cash cattle trade.

  • Cattle futures are expected to see followthrough from yesterday's gains as well as some expectations for $1 higher cash cattle trade compared with last week's $126 trade.
  • While packers' profit margins remain in the red and there's no concrete evidence the beef market has posted a low, packers are thought to be short bought on this week's needs.
  • Choice beef values firmed 13 cents and Select rose $1.03 yesterday on solid movement of 209 loads.
  • Strength in the corn market this morning could weigh on feeder cattle futures, although feeders have taken their cue from live cattle so far this week.


Lean hog futures are called to open higher on followthrough from yesterday's gains.

  • Lean hog futures are expected to enjoy followthrough from yesterday's gains, although buying could be limited by the sharp premium nearby futures have already priced into the market compared to the cash index.
  • Pork cutout values slipped 79 cents yesterday, but packers' profit margins remain deep in the black.
  • Packers need to secure additional loads for Saturday's kill, which is expected to result in steady to firmer cash hog bids today.
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