Market Snapshot, 10:00 a.m. CT -- (VIP) -- August 22, 2013

August 22, 2013 04:59 AM
 

Corn futures are 2 to 8 cents lower this morning.

  • Corn futures are seeing profit-taking today after yesterday's strong gains. Strength in the U.S. dollar index is adding pressure.
  • Day 3 of the Midwest Crop Tour revealed a corn yield in Illinois of 170.48 bu. per acre, which compares to 121.60 bu. per acre last year and a three-year average of 148.04 bu. per acre. But countering this were disappointing results from western Iowa. Full results for Iowa will be released tonight, along with data from Minnesota.
  • Rains moving into drought areas of the western Corn Belt today are adding to price weakness.
  • Meanwhile, this morning's weekly export sales data shows sales of 58,200 MT for 2012-13 and sales of 434,400 MT for 2013-14 delivery -- falling short of expectations but still representing decent demand for new-crop.
  • Gulf basis jumped 7 cents for immediate delivery and 5 cents for November this morning, pointing to tight supplies and possibly fresh export demand news.

 

Soybean futures have firmed to trade mixed through the January contract, while deferred months are 3 to 9 cents higher.

  • Early profit-taking in the soybean market has given way to some bargain buying as soy demand remains strong and there are dryness and maturity concerns with the U.S. bean crop.
  • Beneficial rains are moving into the western Corn Belt this morning, but showers are not expected to be widespread and heat is expected to build again over the weekend and in the 6- to 10-day outlook.
  • Day 3 of the Midwest Crop Tour revealed Illinois soybean pod counts in a 3'x3' square of 1,115.97, which is down from the three-year average of 1,149.47 and pod counts from western Iowa were very low. Final results from Iowa and Minnesota will be released tonight.
  • This morning's weekly export sales of 20,900 MT for 2012-13 and 926,000 MT for 2013-14 fell short of expectations but the overall tally still represents strong demand. China was the lead buyer.

 

Wheat futures are 2 to 4 cents lower this morning in all three flavors.

  • Wheat futures are lower due to spillover from corn and strength in the U.S. dollar index.
  • This morning's weekly export sales data is neutral for wheat, as sales of 494,000 MT for 2013-14 matched expectations.
  • Concerns persist about wheat losing out on export business due to higher U.S. wheat prices.
  • However, a 5-cent boost in Gulf basis for immediate delivery signals improved demand.

 

Live cattle futures are posting slight losses this morning. Feeder cattle are mixed.

    Expectations are for higher trade, but this is already factored into prices, leaving the market vulnerable to some light profit-taking.
  • Strength in the U.S. dollar index is also encouraging of some selling.
  • Bids and asking prices remain $4 to $5 apart, signaling trade may not take place until Friday.
  • Adding light pressure is a slide in beef prices yesterday, though movement did improve to 195 loads. There are also some concerns about demand softening after Labor Day.
  • Weekly beef export sales of 16,100 MT represent strong export demand. This tally matched that of the previous week.
  • Feeders are mixed as weaker corn prices are encouraging some light short-covering.

 

Lean hog futures are posting moderate losses amid light trading interest.

  • Seasonally expanding supplies and a decline in the pork market are weighing on hog futures this morning.
  • The pork cutout value plunged $2.50 yesterday, but the softer prices did spur strong movement of 425.1 loads.
  • This trimmed packer profit margins and is causing them to keep bids steady to $1.50 lower.
  • But pressure on nearby contracts will likely be kept in check by the steep discount they maintain to the cash hog index.
  • Weekly pork export sales fell 5,300 MT from week-ago to 7,100 MT the week ended Aug. 15.
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