Market Snapshot, 10:00 am CT (VIP) -- November 21, 2013

November 21, 2013 04:07 AM

Corn futures are 2 to 5 cents higher this morning, with nearby contracts leading gains.

  • A reminder that current prices are rebuilding demand is encouraging short-covering in the corn market this morning.
  • Weekly export sales of 945,100 MT for 2013-14 and sales of 37,600 MT for 2014-15 topped expectations for the week ended Nov. 14. Prices have softened since that time, which could signal more strong sales tallies lie ahead.
  • Recent overnight sales action also signals U.S. corn prices are at value levels.
  • Also, traders have caught on to the fact that the lower corn-for-ethanol blend requirement from EPA's Renewable Fuels Standard proposal does not necessarily imply ethanol producers will reduce output since they are enjoying strong margins.
  • But the technical posture of the market still favors market bears and farmers are wrapping up the harvest of a record-large crop, which will continue to temper buying enthusiasm.


Soybean futures are enjoying gains of 7 to 9 cents through the July contract, while far-deferred months are seeing lighter gains.

  • Traders are responding positively to yet another Weekly Export Sales Report that reflects strong demand. Sales in excess of 1.376 MMT for 2013-14 topped expectations by a wide margin. Exports of nearly 2.489 MMT were even more impressive.
  • The report, which featured China as the lead buyer, also quelled rumors that the country had canceled recent soybean buys.
  • Gulf soybean basis is down 2 to 4 cents for near-term delivery as the Army Corps of Engineers finished lock repair work that had slowed transportation the past few days. Plus, harvest is increasing available supplies.


Wheat futures are enjoying slight gains in most contracts across all three flavors. HRW wheat is leading with gains of 1 to 3 cents.

  • Gains in the corn market, losses in the dollar and a strong Weekly Export Sales Report are lifting the wheat market today.
  • Weekly export sales of 618,100 MT for 2013-14 topped expectations and improved from recent weeks.
  • Also, Japan included 51,556 MT of U.S. wheat in its weekly tender for 133,480 MT of milling wheat.
  • Gulf SRW wheat basis is steady to 5 cents higher for 2013 delivery, signaling more demand news may be ahead.
  • The expansion of drought across the South adds light support, though the winter wheat crop is still off to a strong start. This will continue to limit buying interest to short-covering.


Live and feeder cattle futures opened under pressure, but live cattle have improved to post slight gains in most contracts, while feeder cattle are mixed.

  • Traders have shifted gears to favor the upside as they ready positions as they wait for cash cattle trade and the Cattle on Feed Report.
  • Futures prices indicate traders expect steady to lower cash cattle trade this week compared to last week's $132 action. But trade may hold off until after tomorrow's Cattle on Feed Report.
  • The monthly feedlot audit is expected to show On Feed at 94.2%, Placements at 110% and Marketings at 101.5% of year-ago levels.
  • The boxed beef market has been steady to lower this week, but yesterday's 32-cent gain in Choice cuts and 60-cent drop in Select values spurred strong movement of 258 loads.
  • Beef export sales for the week ended Nov. 14 were also impressive at 16,600 MT for 2013 and 5,200 MT for 2014.
  • The market will also receive an update on the frozen beef supply situation Friday. Pre-report expectations are for frozen beef stocks at the end of October to come in around 447.8 million lbs., up 1% from the previous month and 4.4% above year-ago levels.
  • Strength in the corn market is keeping feeder cattle futures choppy.


Lean hog futures are posting slight losses this morning.

  • Heavier hog weights and rising numbers are keeping the cash hog market steady to lower, despite strong packer profit margins. Packers have upped weekly kills and are planning a large slaughter Saturday to take advantage of those wide profit margins.
  • The pork cutout value fell another $1.04 yesterday, but this spurred impressive movement of 500 loads.
  • Weekly pork export sales also rose over the week prior to 9,000 MT.
  • Traders are also readying for Friday's Cold Storage Report, which is expected to show frozen pork stocks around 565.5 million lbs., slightly below the month prior and down 6.3% from last year's October figure.
  • The wide premium December lean hogs hold to the cash hog index is adding pressure.
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