The corn market is posting losses around 1 to 2 cents in most contracts.
- Attitudes remain highly bearish in the corn market as traders are more focused on the record-large crop and "better-than-anticipated" yields than on rebuilding demand.
- Strength in the U.S. dollar index also favors market bears.
- Traders will receive an official update on the size of the crop next Friday.
- Market action indicates little concern about news the U.S. ag attaché in Argentina forecasts the 2013-14 Argentine corn crop at 24 MMT, which is 2 MMT below USDA's current estimate, as it is quite early in the growing season.
- Gulf corn basis rose a penny for January and February delivery, possibly signaling more export business is ahead. But so far, impressive export news has only been enough to support the market, not to spur active buying.
Soybean futures have softened to post losses of 4 to 8 cents through the July contract.
- Disappointment over the market's inability to rally around a highly impressive export sales tally for the weeks ended Oct. 10, 17 and 24 yesterday is encouraging some followthrough selling to wrap up the week.
- Strength in the U.S. dollar index is also encouraging to that end.
- Expectations for a record-large bean crop in South America and reports that yields in the U.S. have been better-than-expected have made it tough for the bean market to respond to strong demand news, as demand strength has been a constant for the market.
- Traders expect Monday's crop progress update from USDA to show harvest moving into the final stages.
- USDA announced export sales of 115,000 MT of soybeans to China and a 33,000-MT soyoil sale to an unknown destination -- all for 2013-14. But again, this is simply providing underlying support.
- Gulf basis jumped 2 to 6 cents for 2013 delivery this morning, while basis firmed a penny for January and softened by 15 cents for February delivery. This signals strong export demand.
SRW wheat has firmed to trade around a penny higher while HRW and HRS wheat are mixed with nearbys favoring the downside.
- Corrective short-covering is lifting the SRW market, while strength in the U.S. dollar index and spillover from corn are pressuring other flavors.
- Rain in the forecast for winter wheat country next week is seen as favorable for the establishing crop. The market will get a condition and progress update from USDA on Monday.
- Concerns that wheat demand has softened as prices rose is also limiting buying interest in wheat. Wheat export sales were notably unimpressive for the Oct. 4-24 period, despite a big drop in the U.S. dollar index during that period.
- News the U.S. ag attaché in Argentina has lowed its forecast for the 2013-14 wheat crop to 10.5 MMT, which is 1.5 MMT below USDA's current estimate is helping to lift the SRW market today.
Live cattle futures are off to a narrowly mixed start. Feeder cattle futures are mixed with a downside bias.
- Traders are focused on evening positions ahead of the weekend.
- Yesterday's Cattle on Feed (COF) Report was mildly friendly as it showed Placements a touch above expectations at 101% of year-ago, marketings stronger than expected at 106% of year-ago and on feed just below expectations at 92% of year-ago levels.
- This leaves the market to focus on cash expectations. Some light sales took place in the dressed market yesterday at higher prices, but trade has not yet got underway in earnest.
- While showlists are up slightly from the week prior, they are still on the tight side.
- And the boxed beef market has posted strong gains this week, though the market did see a pullback yesterday. Choice cuts slipped 51 cents to $205.17 per cwt. and Select dipped a penny to $190.08 per hundredweight. However, the price rise has slowed movement. Just 120 loads changed hands yesterday.
- Adding to demand concerns, yesterday's Cold Storage Report showed frozen beef stocks at the end of September up 3% from the month prior and 5% above year-ago whereas traders had expected a mild decline from month ago and a 1.5% increase over year-ago.
Lean hog futures are slightly to moderately lower this morning.
- The lean hog market has given strong chart signals this week it has put in a top. As a result, traders are exiting positions ahead of the weekend.
- Adding incentive to do so, the cash hog index has declined this week and it is currently in line with the front-month contract.
- Supplies are building as temperatures cool, and packers are well supplied on near-term needs. Therefore, packers are keeping bids steady to lower today.
- Light pressure also comes from yesterday's Cold Storage Report that showed frozen pork stocks at the end of September slightly heavier than anticipated. Stocks were down 10% from year-ago, whereas traders had anticipated a 10.4% decline.
- The pork cutout value surged $1.65 yesterday but movement was lackluster at 302.21 loads.