Ahead of the Open (VIP) -- December 24, 2013

December 24, 2013 02:15 AM

NOTE: Grain markets close at noon CT today, while trading in livestock markets halts at 12:15 p.m. CT.

Corn futures are expected to open steady to 2 cents lower this morning.

  • Corn futures ended the overnight session steady to 2 cents lower in thin trade.
  • Price action is likely to be light and choppy today ahead of Christmas. Some traders are opting to take an extended break and fresh news is limited.
  • U.S. dried distillers grain (DDG) shipments to China have been uninterrupted despite recent big rejections of U.S. corn, according to China National Grain and Oils Information Center. The state-run think-tank forecasts China to import a record 4.5 MMT of DDGs in 2013-14, up 60% from 2012-13.
  • South Korea purchased 120,000 MT of U.S. corn overnight, of which one cargo was switched from Black Sea origin.


Soybean futures are called 2 to 4 cents lower on the open this morning.

  • Soybean futures were finished the overnight session mostly 2 to 4 cents lower in light and choppy pre-holiday trade. Light trading activity is expected through today's abbreviated session as many traders have already left for Christmas.
  • Some forecasters are calling for slightly better rain chances through Argentina's main grain areas the second half of the week. This weighed on prices overnight.
  • But given hot temps in the country, attitudes could shift if the rain chances are decreased again. Argentine weather will be a focal point after the Christmas break.
  • USDA announced 185,000 MT of daily soybean sales to unknown destinations, with 65,000 MT for 2013-14 and 120,000 MT for 2014-15. Also, USDA announced a sale of 114,000 MT of soybeans to Egypt for 2013-14. This should help limit selling interest.


Wheat futures are expected to open 1 to 2 cents lower this morning.

  • SRW and HRW wheat futures ended the overnight session mostly 2 to 3 cents lower, while HRS futures were 1 to 2 cents lower.
  • Plentiful global supplies continue to weigh on the wheat market. Traders perceive this to mean the U.S. will struggle to actively export wheat.
  • India tendered to export a total of 250,000 MT of wheat overnight, reminding traders of the competition U.S. wheat faces on the global market.
  • Traders aren't concerned with the bitterly cold temps that have hit winter wheat areas. Much of the country's midsection is blanketed by snow, which will help insulate the crop from the arctic air. Temps are expected to get low enough to do damage in areas that aren't protected by snow.


Live cattle futures are called to open mixed. Feeder cattle are also called mixed, but the market might slightly favor the upside.

  • Live cattle futures are expected to be choppy in what's likely to be a lightly traded session ahead of Christmas.
  • No cash cattle activity is expected until later this week. While eventual cash cattle trade is still up in the air, most traders are expecting mostly steady cash prices compared with last week's $130 trade in the Plains.
  • Boxed beef prices were 10 cents lower for Choice cuts and $2.09 higher for Select cuts yesterday. Packers moved only 101 loads of product on the day.
  • Beef stocks in frozen storage as of Nov. 30 were slightly less than anticipated at 445.002 million lbs., but that won't be enough to spark active buying interest.
  • Feeder cattle futures may get a slight boost if mild weakness in the corn market overnight continues through the day session. But barring a fund-led move, feeders aren't likely to stray far from unchanged.


Lean hog futures are expected to open with a mixed tone.

  • Lean hog futures are expected to be choppy this morning as the traders that are working today to wrap up positions ahead of Christmas.
  • The cash hog market is expected to be steady to weaker today. Packer demand for cash hogs is limited ahead of Christmas. Most plants will reassess slaughter needs after tomorrow's holiday.
  • Hog movement is likely to be slowed across the Upper Midwest today by bitterly cold temps. Double-digit below zero readings are common through the region this morning.
  • Pork stocks in storage at the end of November were slightly less than anticipated at 546.333 million lbs., but this will not be market-moving.
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