Corn futures are off to a better-than-expected start with old-crop up 5 to 8 cents and new-crop roughly 2 to 3 cents higher.
- Corn futures are benefiting from spillover support from soybeans this morning.
- Also, rains in the western Corn Belt today, which are expected to be followed by a blast of cold temps, are keeping planting delay concerns close at hand.
- The market is also reducing some risk exposure ahead of USDA's balance sheet adjustment tomorrow. They expect USDA to project a major rebound in production for 2013-14 with ending stocks of 1.973 billion bushels. Pre-report expectations are for USDA to trim its 2012-13 estimate by 3 million bu. to 754 million bushels.
- Buying interest is being limited by this morning's disappointing weekly export sales of 115,800 MT for 2012-13 and sales of 169,900 MT for 2013-14. The total was down sharply from last week.
- Also, Gulf basis slid a penny for immediate delivery and it was steady to 5 cents lower for other months this morning, signaling still-slow demand.
Old-crop soybean futures are double-digit higher this morning, while new-crop is seeing gains mostly around 3 cents.
- Concerns about tight old-crop beans supplies are lifting soybean futures this morning. Recent daily sales to China, including a 110,000 MT sale today signal they see current prices as a value.
- The market expects USDA to trim its old-crop carryover estimate by 1 million bu. from last month tomorrow to 124 million bu., also pointing to tight supplies.
- Meanwhile, buying interest in new-crop beans is being limited by expectations for production to rebound in 2013-14, especially if corn planting delays persist into month-end.
- Pre-report expectations are for USDA to project 2013-14 carryover at 239 million bushels.
- Weekly export sales of 193,800 MT for 2012-13 and 391,700 MT for 2013-14 were within expectations.
Chicago wheat futures have rallied to post double-digit gains; Kansas City is up 9 to 12 cents, and Minneapolis is 7 to 10 cents higher.
- Wheat is enjoying spillover support from corn and soybeans this morning. Gains are impressive, considering strength in the U.S. dollar index.
- Drought worsened across Texas last week, adding to concerns about the HRW wheat crop. Also, there are freeze chances for the Northern Plains, raising concerns about spring wheat planting.
- But countering this are rains moving across the Central and Southern Plains, though this system was associated with some wind and hail damage.
- Weekly export sales of 239,200 MT for 2012-13 and 226,300 MT for 2013-14 matched expectations.
- Iraq tendered for at least 50,000 MT of optional origin wheat. Jordan tendered to purchase 150,000 MT of optional origin milling wheat and 100,000 MT of optional origin feed barley.
Live cattle futures are narrowly mixed this morning. Feeder cattle futures are also choppy.
- Live cattle futures are enjoying some light, corrective short-covering today as futures are well below this week's $126 to $127 cash cattle trade, which was down roughly $2 from the bulk of last week's action on the Southern Plains.
- Light support also stems from yesterday's $3.48 surge in Choice boxed beef prices to an all-time record of $204.67. Select cuts also rose 37 cents. Movement was also stronger than in recent days, signaling some improvement in demand.
- Nevertheless, light movement overall in recent weeks means the market remains concerned that high prices are not sustainable.
- Gains are also being limited by a 5,800 MT decline in weekly beef export sales from the week prior to 10,100 MT.
- Feeder cattle futures are mixed as they weigh strength in the corn market against ideas the downside has been overdone.
Lean hog futures are posting mostly slight losses in light, early trade.
- Traders are taking advantage of dollar strength and yesterday's gains to book some profits.
- But outside of that, selling interest is relatively limited as supplies are tightening and packers are again paying steady to higher prices for cash hogs.
- Plus, the pork cutout value rose 52 cents yesterday and movement improved to 505.6 loads yesterday.
- But recent softer pork prices paired with steady to firmer cash prices have resulted in deeply negative packer profit margins. This could limit demand if the pork market falters again.