Corn futures are enjoying 1- to 4-cent gains in most contracts this morning.
- Signs of demand improvement and a weaker U.S. dollar are encouraging mild short-covering in the corn market this morning.
- Weekly corn export sales of 314,700 MT for 2012-13 and 21,200 MT for 2013-14, met expectations. Old-crop sales improved 21% from the week prior.
- More importantly, USDA announced a 300,000-MT corn sale to China for 2013-14 and a 240,000-MT sale to an unknown destination for 2013-14 this morning.
- But buying interest is being limited by expectations that corn planting progress will quickly ramp up as temps are forecast to warm.
- Also, news the International Grains Council raised its world 2013-14 corn output projection by 12 MMT to 939 MMT is a limiting factor.
Old-crop soybeans are 14 to 18 cents higher while new-crop futures are around 5 to 8 cents higher.
- Traders are covering short positions on ideas the downside was overdone yesterday, especially considering the tight old-crop supply situation.
- Summer-month contracts are leading the rally on reports that an official at Bunge said that while logistics congestion is improving in Brazil, he expects shipping delays to continue until the U.S. harvest.
- Weather uncertainty is also providing light support. While temps are expected to warm up in the 6- to 10-day window, above-normal precip is also expected, which could compound flooding in the eastern and northern parts of the Corn Belt.
- Traders are ignoring this morning's disappointing weekly export sales data that showed a net sales reductions of 206,300 MT for 2012-13 (a marketing-year low) and sales of 628,500 MT for 2013-14.
- Gulf soybean basis softened 5 cents for immediate delivery pointing to increased farmer selling and/or softening demand.
Wheat futures are enjoying gains around 6 cents in Chicago, while Kansas City is 6 to 13 cents higher and Minneapolis is enjoying gains around 9 to 10 cents.
- Fundamentals are finally getting some attention from the market today as traders look ahead to next week's HRW wheat tour.
- Recent freeze events are expected to further draw down the quality of the winter wheat crop that was already in tough shape due to the drought that still stretches across the Central and Southern Plains.
- Minneapolis wheat is also benefiting from concerns about the very slow start to spring wheat planting. Flooding in northern regions is expected to cause further delays.
- Citing higher plantings and improved yields, International Grains Council pegged global wheat production for 2013-14 at 680 MMT, which is would be up 4% from 2012-13, but down 3 MMT from its prior estimate. This is limiting buying interest in Chicago wheat.
- This morning's weekly export sales data was also disappointing as sales of 71,700 MT for 2012-13 (a marketing-year low) and 234,700 MT for 2013-14 fell short of expectations.
Live cattle futures are mixed in early trade with the front-month contract slightly higher and deferred months slightly lower. Feeder cattle futures are slightly to moderately lower in most contracts.
- Action is relatively quiet today with April live cattle seeing some light followthrough buying as traders wait for cash cattle trade to begin. The front-month is in line with trade last week.
- The boxed beef market has given some signals a low may be in and that a seasonal spring grilling rally may be underway, but more improvement will be needed to "prove" this.
- Yesterday, Choice and Select cuts firmed and movement was stronger at 209 loads.
- But showlists are heavier this week and packers have been dealing with negative profit margins for quite some time, which will make them unwilling to raise bids.
- Outside markets are also friendly toward commodity buying this morning, with the dollar under pressure and the stock market and crude oil futures enjoying light gains.
- Traders are booking some profits in the feeder cattle market after strong gains the past two days. Strength in the corn market is also encouraging of this.
Nearby lean hog futures are slightly higher, while deferred months are slightly lower.
- Deferred lean hog futures are seeing some light profit-taking after the market posted strong gains the past two sessions. Also encouraging of this is the steep premium nearbys hold to the cash hog index.
- But selling interest outside of profit-taking is limited as the pork market has improved notably in recent sessions, signaling retailers are stocking up pork supplies in anticipation of spring grilling as temps warm up.
- While the pork cutout value slipped 79 cents yesterday, movement was strong at 473.9 loads.
- Weekly pork exports also improved 3 MT from the week prior to 12,200 MT.
- Packers are enjoying wide profit margins. Cash hog bids are expected to be steady with a few firmer bids as flooding in areas of the eastern Corn Belt is disrupting transportation.