Market Snapshot, 10:00 a.m. CT -- (VIP) -- November 15, 2013

November 15, 2013 03:56 AM

Corn futures are enjoying fractional to 3-cent gains this morning.

  • Weekly corn export sales of nearly 1.203 MMT for 2013-14 topped lofty expectations. This is giving bulls a slight advantage to wrap up the week.
  • Export commitments for the 2013-14 marketing year are running 110% ahead of year-ago levels; USDA expects exports for this marketing year to be up 91.5% over year-ago.
  • Gulf basis is steady to a penny higher this morning, continuing the basis strength trend this week. This indicates ongoing export demand strength.
  • But a large 2013 U.S. corn crop continues to temper gains.
  • Also, Argentina is enjoying favorable planting weather.
  • Outside markets are also mildly supportive this morning.

Soybean futures have softened to post losses in the mid- to upper teens.

  • Funds are taking profits in the bean market to wrap up the week. Nearby contracts dipped below the psychological $13.00 level this morning, triggering sell stops.
  • Traders were disappointed by this morning's weekly soybean export sales of 848,500 MT for 2013-14 and 60,600 MT for 2014-15, which came in at the low end of expectations. The market is brushing off highly impressive exports in excess of 2.065 MMT.
  • Gulf basis if steady to 4 cents higher for 2013 delivery, signaling more announcements of export business may lie ahead.
  • Forecasts for rain in Brazil are expected to improve crop prospects in the country.
  • Traders are ignoring news China will continue purchasing soybeans for its state reserves from farmers in the country at prices 10% above current U.S. prices, which would likely keep domestic prices above global prices and lead to higher imports.

Wheat futures are mixed in the SRW market but steady to slightly lower in the HRW and HRS wheat markets.

  • Traders are focused on position evening to wrap up the week.
  • This morning's weekly export sales report confirmed ideas U.S. wheat is losing out on export business, as wheat sales fell short of expectations at 287,800 MT for 2013-14 and 900 MT for 2014-15.
  • News Ukraine's prime minister expects the country to harvest a record 61 MMT grain crop this year adds light pressure.
  • But the market is thus far respecting near-term levels of support.
  • Also, there has been an increase in daily sales announcements from private sources this week, which suggests next week's sales report should reflect an uptick in demand due to lower prices.

Live cattle futures are posting slight losses this morning. Feeder cattle futures are narrowly mixed with most contracts favoring the upside.

  • The cash cattle standoff continues, which is leaving traders to even positions as they wait for trade to get underway. Nearby futures are at a premium to last week's prices, opening the door for some light profit-taking.
  • Packers continue to deal with negative cutting margins and showlists are up slightly in most locations.
  • On the other hand, the overall supply situation is tight and boxed beef movement has improved this week amid a slight pullback in prices.
  • Yesterday, Choice boxed beef cuts fell 45 cents while Select rose 3 cents; movement was decent at 170 loads.
  • Feeder cattle futures are seeing a mix of followthrough buying after yesterday's gains and profit-taking on strength in the corn market.

Lean hog futures gapped higher on the open, leaving an island bottom. Most contracts are enjoying slight gains.

  • Ideas the downside was overdone yesterday is lifting the lean hog market to wrap up the week. This market has done an impressive job of filling gaps in recent weeks.
  • Adding light support was a 57-cent jump in the pork cutout value yesterday and strong movement of 465.83 loads.
  • While pork prices have generally softened this week, this has led to consistently strong movement.
  • But buying interest will likely remain limited to short-covering as supplies continue to rise seasonally and hog weights are at record highs.
  • This is keeping the cash hog market steady to lower.
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