Market Snapshot, 10:00 am CT (VIP) -- October 14, 2013

October 14, 2013 04:58 AM

Corn futures are posting slight gains of mostly 1 to 2 cents this morning.

  • Spillover from soybeans and a softer U.S. dollar index are encouraging light short-covering in corn to start the week.
  • Rains moving across the Corn Belt the first half of the week will slow harvest efforts. But weekend rains were lighter and less widespread than anticipated.
  • Harvest is expected to be around 25% to 35% complete, but USDA confirmation of such ideas remains lacking due to the government shutdown. Hedge pressure related to harvest will continue to weigh on the market near-term.
  • China National Grain and Oils Information Center (CNGOIC) says the country's corn production will likely rise 4.6% over year-ago to 215 MMT -- a record-large crop.


Soybean futures are 9 to 14 cents higher this morning.

  • The market is benefiting from rumors China is buying U.S. soybeans. However, confirmation of any such news will likely remain absent until the government reopens. A lower U.S. dollar index is also encouraging of such ideas.
  • Through the first nine months of this calendar year, China has imported 45.75 MMT of soybeans, a 3.3% increase from year-ago. But the country imported 4.7 MMT of soybeans in September, down 26.2% from August and 5.4% below year-ago.
  • CNGOIC forecasts this year's Chinese bean production at 12.5 MMT, which would be down 4.2% from last year.
  • Gulf basis fell a penny for immediate delivery this morning, signaling harvest activity is making supplies more readily available.
  • But a slow harvest pace in the western Corn Belt led to increases in basis at some western Iowa and eastern Nebraska locations today. In eastern locations, where harvest has been more active, basis continues to slide.
  • Rains in the forecast for Brazil's main production regions this week could help harvest efforts, which have been delayed due to a dry September.


Wheat futures are mostly lower, with losses generally in the 1- to 2-cent range.

  • Much of the Southern Plains is expected to receive rain early this week, which will help recently planted HRW wheat to germinate.
  • Ukraine's grain exports are at 7.4 MMT from July 1 to Oct. 14, which is up 13% from last season thanks to higher wheat shipments, the country's ag ministry reports.
  • As of Oct. 14, Ukraine has harvested 44.5 MMT of grain, which is up 16.5% from year-ago at that time.
  • But a weaker U.S. dollar index and gains in the corn market are helping to limit pressure to light profit-taking.
  • Meanwhile, China says it will raise the price it pays farmers for wheat in 2014 by 5% in hopes of raising production.


Live cattle futures are enjoying slight gains to start the week. Feeder cattle futures are slightly to moderately higher.

  • On Friday, cash cattle trade took place at $2 higher prices in Texas and Kansas, while sales took place at $126 to $128.50 in Nebraska, which was steady to $2 higher relative to the week prior.
  • This is lifting futures to start the week as supplies are expected to tighten going forward, which could point to higher prices this week. Strong sales in Texas last week could tighten showlists again this week.
  • Data from the private firm Urner Barry indicates boxed beef values were mixed on Friday.
  • This plus higher cash prices kept packer cutting margins well in the red, which could make them unwilling to raise bids this week.
  • Also, futures already hold a premium to the cash market.
  • Feeder cattle futures are seeing followthrough buying after the front-month contract climbed to an all-time high last week as a blizzard in the Dakotas tightened already tight supplies. Spillover from live cattle is also supportive.


Lean hog futures are posting slight losses this morning.

  • Trading interest in the lean hog market is light to start the week amid unease regarding the settlement process for October lean hogs today.
  • Also, the market has given some technical signals a top is likely in place.
  • Supplies are rising seasonally, but so is demand. This is resulting in mixed cash hog bids today, with eastern locations paying lower prices and western locations paying higher prices. Packers are still enjoying solid profit margins.
  • Urner Barry data indicates the pork cutout value rose marginally on Friday.
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