Corn futures have softened on profit-taking to trade mostly 6 to 9 cents lower ahead of USDA's reports this morning.
- Traders are reducing risk ahead of the 11:00 a.m. CT release of USDA's Quarterly Grain Stocks and Prospective Plantings Reports.
- Pre-report expectations are for USDA to peg corn plantings at 97.3 million acres, which would be up marginally from 2012.
- Traders expect USDA to peg March 1 corn stocks at 5.03 billion bu., which would be well below 6.023 billion bu. at this time the year prior.
- This data is key as it sets a starting point for plantings and gives traders a better gauge of old-crop supplies.
- This morning's weekly export sales of 295,100 MT for 2012-13 and 18,900 MT for 2013-14 met expectations. This is an 88% increase in old-crop sales relative to the four-week average, but the overall export pace remains sluggish.
Soybean futures have improved to trade fractionally to 2 cents higher in all but far- deferred contracts.
- Traders are squarely focused on readying positions for USDA's key report data.
- Traders anticipate USDA survey data will indicate soybeans picking up roughly 1.3 million acres over year-ago for seedings of 78.5 million acres.
- Pre-report expectations are for USDA to peg March 1 soybean stocks at a tight 947 million bushels.
- Weekly export sales of 66,400 MT for 2012-13 and 607,700 MT for 2013-14 met expectations. China accounted for the vast majority of these new-crop bean buys, reminding traders of the country's seeming insatiable appetite for 2013-14 crop corn.
Wheat futures have seen choppy trade this morning, but the market is currently following corn and trading mostly 3 to 6 cents lower at all three locations.
- Focus in the wheat pit is on evening positions ahead of the 11:00 a.m. CT USDA reports.
- Traders look for USDA to peg wheat stocks as of March 1 at 1.167 billion bu., which, if realized, would be down around 32 million bu. from last year at this time.
- All wheat planted acreage is expected at 56.4 million, which compares to 55.7 million last year. Spring wheat acreage of 12.5 million is expected up just marginally from 12.3 million last year.
- Weekly export sales of 580,300 MT for 2012-13 and 248,300 MT for 2013-14 came in well above expectations and signal U.S. wheat is competitive on the global market.
- Traders are also readying for the restart of weekly condition ratings next week, which will give the market a better idea as to the state of the HRW crop that went into dormancy with the worst rating on record.
Live and feeder cattle futures are posting moderate gains in early trade. Feeder cattle futures are moderately to sharply higher.
- Yesterday's strength in the live cattle market has led to the start of the light cash cattle trade at $127 in Texas and Kansas this morning, which is up $2 from the top end of last week's trading range and light trade earlier this week.
- Firmer trade is already more than priced into the front-month contract, but futures are still getting a boost from the cash strength.
- A recent uptick in boxed beef movement is fueling ideas spring grilling demand is giving the product market a boost. Tighter showlists are also seen as justifying firmer cash prices.
- But boxed beef prices slid another 47 (Choice) and 66 (Select) cents yesterday. An impressive 241 loads changed hands, however.
- Weekly beef export sales continue to improve. Net sales of 17,300 MT for the week ended March 21 were up 13% over week-ago and up 5% from the four-week average.
- Softer corn prices, a lower U.S. dollar index and ideas a seasonal low is in the works are supporting feeder cattle futures.
Lean hog futures are off to a choppy start, with most contracts favoring the downside.
- Traders are readying positions for this afternoon's Quarterly Hogs & Pigs Report, which is expected to show all hogs & pigs at 100.7% of year-ago levels. The pig-per-litter category is expected to come in at 101.1% of year-ago.
- The cash market is steady to firmer at most locations, but some scattered weaker bids are noted. While softer pork prices and firmer bids earlier this week have squeezed margins to near breakeven and limited demand for some packers, others are paying up as they are in need of supplies for early next week.
- Yesterday, the pork cutout value slid 70 cents and movement was light at 35.25 loads.
- The fact April lean hogs are at nearly a $6 premium to the cash hog index signals traders expect the cash and product markets to strengthen seasonally.