Corn Leads Gains Overnight on Chinese Rumors

April 19, 2012 01:17 AM
 

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Overnight highlights. Following are highlights of overnight trade:

Corn: 13 to 15 cents higher. Corn was the upside price leader overnight on news China is back in the market buying U.S. corn. This morning's open will also be influenced by the weekly export sales report, which traders will be looking to see if China is a listed buyer. Ideas recent losses were overdone resulted in a sharp overnight price correction.

Soybeans: 12 to 15 cents higher. Futures kept with the trend set up so far this week of down one day up the next following yesterday's sharp losses. Outside markets are also positive for commodity buying this morning, with investors reacting to a successful bond auction in Spain -- alleviating concerns about euro-zone debt concerns (at least temporarily). Traders are looking for a strong showing in this morning's weekly sales report given continued announcements by USDA that China has been buying beans.

Wheat: 9 to 10 cents higher. Futures saw spillover from neighboring pits and outside markets, as well as short-covering after more technical chart damage was done on yesterday's price slide. Meanwhile, there's little fresh positive news for the wheat market to digest, as rains are in the forecast for dry areas of Europe over the next week. July Chicago wheat slipped to a fresh contract low yesterday to further worsen the technical outlook.

Live cattle: Higher. Futures are expected to see a lift from positive outside markets and signals a near-term low has been posted in the beef market. Choice beef values rose $2.29 yesterday and Select was up $1.68 and have posted strong gains this week. Cash cattle trade is underway at mostly steady values with last week, which is also a limiting factor for bulls. Traders will also be actively evening positions ahead of Friday afternoon's Cattle on Feed Report, expected to show On Feed at 102%, Placements at 92.3% and Marketings at 94.5% of year-ago levels.

Lean Hogs: Mixed. Futures are called to open mixed as positive outside markets should limit selling, however fundamentals remain bearish. Packers' profit margins have slipped deep into the red this week due to pressure on pork cutout values, which were down another 22 cents yesterday. The cash hog market is expected to be weaker again today amid light demand.


 

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