Corn futures have improved to trade 3 cents higher in the front-month and fractionally to 3 cents higher in deferred contracts.
- Active corn planting in the Midwest this week is giving bears a slight advantage. Plus, the crop is being planted into moisture-replenished soils.
- But the fact that it is already mid-month and last Sunday's pace marked the slowest planting pace on record, the market is unwilling to actively add long positions.
- Plus, there is rain and cooler temps in the forecast for the Corn Belt late this week and into next week, which would again halt corn planting.
- Also limiting selling interest is a 14,000 barrel-per-day (bpd) increase in ethanol production last week from the week prior to 857,000 bpd. Ethanol stocks declined 418,000 barrels to 16.43 million barrels.
- Rain is in the forecast for late this week and early next week, so producers are planting around the clock in an effort to get as many acres as possible seeded ahead of the rains.
Soybean futures have firmed to post gains of 2 to 6 cents with new-crop beans leading to the upside.
- Record basis levels for this time of year is supporting old-crop soybeans this morning, as limited farmer selling of a small supply has forced end users to raise bids. A slow start to soybean planting also extends the period until new-crop supplies come available.
- Also speaking to tight supplies, Gulf basis jumped 7 cents for June delivery this morning after rising 16 to 17 cents for May delivery yesterday.
- Meanwhile, Chinese demand for new-crop soybeans remains strong. China National Grain and Oils Information Center forecasts Chinese 2013-14 soybean imports at a record 66 MMT, up 11.9% from the current marketing year.
- This morning, USDA announced a daily soybean sale for 171,000 MT of soybeans to China for 2013-14.
- But buying enthusiasm is being tempered by ideas 2013 crop soybean acres will be above USDA's March 28 projection for 77.1 million acres.
Wheat futures are under pressure, with Chicago roughly 4 to 8 cents lower, Kansas City down 1 to 5 cents and Minneapolis favoring the downside in choppy trade.
- Strength in the U.S. dollar index and pressure on the corn market are encouraging followthrough selling in the wheat market today.
- The market is paying little attention to a blast of hot air that is stressing freeze and drought-stressed winter wheat in the Central and Southern Plains this week as they are more focused on expectations for a large global wheat crop.
- But that could change if prospects change for the global wheat crop. Already, there are concerns about dryness in areas such as the Former Soviet Union and Australia.
Live cattle futures are steady to slightly higher in nearby contracts while deferred months are slightly lower. Feeder cattle futures are slightly to moderately lower.
- Choice boxed beef values surged to another all-time high of $206.09 yesterday, but this has failed to excite market bulls, signaling they still believe a top is near. Movement has remained relatively unimpressive, adding to such ideas.
- But the higher beef prices along with strong packer profit margins have most expecting higher cash cattle trade compared with last week's mostly $126 trade on the Southern Plains. Nearby futures are at a wide discount to these prices.
- The market is also beginning to ready for Friday's Cattle on Feed Report, which is expected to reflect On Feed at 96.3% of year-ago, despite an expected surge in Placements, which the market expects to come in at 112.1% of year-ago.
- Placements will again be the wildcard of the report as there is a 17-point spread between the high and low average trade guess.
- Strength in the U.S. dollar index along with the premium most contracts hold to the cash index is pressuring feeder cattle futures.
Lean hog futures are enjoying slight gains this morning.
- Lean hog futures continue to benefit from overall strength in the cash hog market.
- Today, packers are paying mostly steady prices with scattered firmer bids as they secure supplies for late-week kill needs. While most are cutting in the red, supplies are tightening and planting season is further tightening the number of available hogs.
- The new front-month June contract is at a slight premium to the cash hog index, signaling friendly near-term cash market expectations.
- The pork cutout value rose 25 cents yesterday, but movement slowed to 305.4 loads. The recent pullback in movement signals Memorial Day buying is coming to a close.