Ahead of the Open (VIP) -- July 22, 2013

July 22, 2013 03:13 AM
 

Corn futures are called to open 3 to 6 cents lower.

  • Corn futures ended the overnight session 3 to 6 cents lower, with the most active contracts 5 to 6 cents lower.
  • Pressure on corn futures this morning will come from weather. While weekend rainfall was disappointing across northern and western areas of the Corn Belt, temps are expected to run below normal this week and there are scattered rain chances. As a result, traders deem the forecast as non-threatening.
  • Traders are expecting crop condition ratings to downtick in this afternoon's update after hot, dry conditions last week. That should limit selling interest.
  • Traders are also watching to see if fresh demand news surfaces with December corn futures below $5.00. That last dip below this level encouraged Chinese purchases.
  • Key near-term support for December corn futures lies at the July 8 low of $4.90. A drop below that level could trigger fresh chart-based selling.

 

Old-crop soybeans are expected to lead price gains on what's expected to be a firmer open this morning.

  • August and September soybean futures finished 13 1/2 and 7 3/4 cents higher, respectively, overnight. New-crop futures were 2 to 4 cents firmer.
  • Tight supplies and still-strong demand are supporting old-crop soybean futures.
  • New-crop futures are expected to be pulled higher by old-crop contracts, though a generally non-threatening weather forecast should limit buying interest.
  • Weekend rainfall favored southern and eastern areas of the Corn Belt over the weekend, with the Delta also receiving rains. Northern and western areas of the region got very little rainfall. Forecasts call for below-normal temps and scattered rain chances this week. The best chance for rains is in southern areas of the Corn Belt into the Delta.

 

Chicago wheat futures are called 1 to 3 cents higher this morning.

  • Chicago wheat ended the overnight session steady to 1 cent higher overnight, while Kansas City wheat was 2 to 4 cents higher and Minneapolis was 2 to 3 cents firmer.
  • A weaker dollar is supportive for wheat futures this morning. That's helping encourage short-covering as the market tries to put in a seasonal low.
  • Harvest pressure is winding down, which should ease selling interest. Until the corn market shows strength, however, buying interest in wheat will be limited.
  • Global export demand is picking up, but the U.S. is not getting much of the business. U.S. wheat prices are higher than other global exporters.

 

Live cattle futures are called to open mixed. Feeder cattle futures are seen opening steady to firmer.

  • Last Friday's Cattle on Feed Report was mostly neutral as the On Feed and Placements categories were right in line with the average pre-report guesses. Marketings came in a little stronger than anticipated, which should support nearby live cattle futures.
  • With no major surprises in the Cattle on Feed Report, traders' focus will remain on cash fundamentals. Traders are waiting on clear signs of a low in the boxed beef and cash cattle markets before actively buying futures.
  • Cash cattle traded at steady $119 in the Plains last Friday, but final sales totals won't be known until later this morning as cash trade pushed deep into day.
  • Feeder cattle futures are expected to get a boost from weaker trade in the corn market, though expected choppy trade in live cattle could limit buying interest.

 

Lean hog futures are called to open the week mixed.

  • Light and choppy trade is expected to open the week in the lean hog market. Traders are awaiting USDA's Cold Storage Report this afternoon, which is expected to show record-large pork stocks for the end of June.
  • Cash hog bids are expected to be steady to weaker across the Midwest to open the week. Most plants are thought to be bought ahead on slaughter needs for the week and their attention will be on trying to improve margins.
  • The pork cutout value continues to slide. Prices dipped only 18 cents Friday, but packers moved just 231.5 loads of product at the lower prices.
  • While the cash and product markets are softening, the big discount August hogs hold to the cash index will limit selling interest.
Back to news


Comments

 
Spell Check

No comments have been posted to this News Article

Corn College TV Education Series

2014_Team_Shot_with_Logo

Get nearly 8 hours of educational video with Farm Journal's top agronomists. Produced in the field and neatly organized by topic, from spring prep to post-harvest. Order now!

Markets

Market Data provided by QTInfo.com
Brought to you by Beyer
Close