Corn futures improved with the open of pit trading to trade steady to 5 cents higher.
- May corn futures settled above the 50-day Moving Average yesterday, spurring additional technical buys today.
- The rest of the market is seeing light short-covering thanks to concern about tight old-crop supplies and recent signs of improved export demand.
- Gulf basis levels were steady to 2 cents higher this morning, signaling tight supplies and the possibility export demand news lies ahead.
- Plus, sources report private Chinese feedmills have purchased around 600,000 MT of 2013-crop U.S. corn on the recent price drop, leading to calls for the government to issue more import quotas.
- But buying enthusiasm in new-crop corn remains limited by expectations for a large 2013 crop.
Soybean futures continue to post losses around 2 to 6 cents, with old-crop contracts leading losses.
- Traders are booking some profits in soybean futures today after the market posted gains yesterday. Traders are nervous about how long strong export demand, especially from China, will last.
- Delays at Brazilian ports have kept the export window open longer than usual, but eventually this will change, easing concerns about tight U.S. carryover supplies.
- Plus, traders are concerned the recent price advance in beans could encourage some to hold off on purchases until South American supplies come available.
- But 1 to 2 cent higher Gulf basis levels for immediate delivery signal that may not be an option for some importers.
Wheat futures remain narrowly mixed at all three locations.
- Spillover from the corn market is encouraging light short-covering in some wheat contracts.
- And while topsoil moisture profiles have improved in the Southern and Central Plains have improved, much more is needed.
- State crop reports reveal that 44% of Texas' wheat crop is still rated "poor" to "very poor."
- Buying interest is being limited by above-average chances for precip in Nebraska and northeast Kansas in the 6- to 10-day forecast.
- Recent news that some ethanol plants are using wheat to produce ethanol is also providing light support.
Live cattle futures got off to a choppy start but have since improved to post slight to moderate gains in most contracts. Feeder cattle futures are mostly moderately higher.
- Live cattle futures are choppy this morning as traders await direction from the cash market. Initial indicators give packers an edge in negotiations.
- The boxed beef market got off to an unimpressive start yesterday as prices were mixed and movement was notably light at 103 loads.
- While showlist estimates are up slightly in Nebraska, Kansas and Texas, they are down by a like amount in Colorado.
- But the fact that some packers have seen margins move into positive territory may give them incentive to boost their slaughter schedules.
- The front-month contract is at a slight premium to the bulk of last week's cash trade at $128.
- Feeder cattle futures are benefiting from corrective short-covering.
Lean hog futures are enjoying slight, corrective gains this morning.
- Ideas the downside has been overdone of late are encouraging light short-covering in the lean hog market this morning. A weaker U.S. dollar index is also encouraging of this.
- Traders are hopeful the pork market will soon put in a low as Easter ham buying and spring grilling picks up. Yesterday, the pork cutout value firmed 69 cents, but movement was very light at 24 loads.
- But buying interest is being limited by the nearly $3.50 premium they hold to the cash hog index.
- While packers are enjoying profitable margins most plants are well supplied for near-term needs. Thus, cash hog bids are mostly steady today.
- Improved weather across the Midwest is also expected to increase hog marketings, further limiting packers' need to bid up for supplies.