Market Snapshot, 10:00 a.m. CT (VIP) -- October 24, 2013

October 24, 2013 05:03 AM
 

Corn futures have chopped on either side of unchanged overnight and this morning. At present, futures are 3 to 4 cents lower.

  • Corn market received a dose of daily and weekly export demand news today.
  • Weekly export sales data showed corn sales in excess of 1.341 MMT for 2013-14 delivery the week ended Oct. 3, which came in well above expectations. This indicates exporters took advantage of the government blackout to book needs.
  • USDA also announced a 210,000-MT corn sale to Mexico for 2014-15 this morning.
  • Gulf basis is steady to a penny higher again this morning, signaling more export business announcements may lie ahead.
  • But today's price action signals that with harvest underway, strong demand is enough to support prices but not enough to spur active buying interest at this point.
  • The forecast for drier weather through Monday is expected to help harvest activity ramp up. But precip is in the forecast thereafter.

 

Soybean futures have improved to trade 1 to 5 cents higher in most contracts, with the November contract leading gains.

  • Nearby contracts are seeing light support from a strong weekly export sales tally of 929,800 MT for 2013-14 and 18,000 MT for 2014-15 the week ended Oct. 3, which met expectations.
  • Even more impressive is that USDA reports soymeal sales of 850,100 MT, which was more than three times the top end of traders' expectations.
  • However, Gulf soybean basis fell 2 cents for immediate delivery and a penny for November this morning, signaling harvest is easing the tight supply situation.
  • Beans are seeing some spreading activity with corn this morning.
  • A weaker U.S. dollar index and greater risk appetite among traders is also providing light support.

 

Wheat futures have softened to trade 1 to 2 cents lower in the SRW market, 2 to 5 cents lower for HRW wheat and mixed in the HRS market.

  • Spillover from the corn market is weighing on wheat today.
  • Also, this morning's Weekly Export Sales Report reflected a pullback in wheat sales from recent weeks. Sales of 653,600 MT for 2013-14 for the week ended Oct. 3 came in near the low-end of pre-report expectations.
  • However, this tally preceded the mid-month plunge in the U.S. dollar index.
  • Also, overnight export action of late has shown other countries receiving much of the business.

 

Live cattle futures are seeing some bull spreading this morning with October through April futures slightly higher and deferred months slightly lower. The front-month gapped higher on the open. Feeder cattle are posting slight losses.

  • Cattle futures are enjoying cautious buying after cash cattle trade took place yesterday at mostly $132 to $133 in Texas and at $131 to $133 in Kansas -- a record high for both states. Last week, the bulk of sales took place at $129 in these states. Trade is thought to be largely wrapped up for the week.
  • Cash strength was propelled by strong gains in the boxed beef market yesterday along with tighter showlist estimates.
  • Choice beef values rose $1.46 yesterday to $200.79 per cwt. and Select rose $1.88. Even more impressive, a solid 181 loads changed hands with these lofty prices.
  • Weekly beef export sales of 10,400 MT for the week ended Oct. 3 were down 2,400 MT from the week prior.
  • Profit-taking is pressuring feeder cattle futures.

 

Lean hog futures are posting slight to moderate gains this morning.

  • Lean hog futures are benefiting from the near $3 discount December futures hold to the cash hog index, which was most recently projected to rise to $91.25.
  • There is also some speculation the runup to $200-plus Choice beef prices could lift demand for less expensive pork.
  • Cash hog bids are expected to be steady to $1 lower today as packers have this week's needs secured and are preparing for the week ahead.
  • Supplies are expanding seasonally, which is also a weight on the cash market.
  • The pork cutout value plunged $1.60 yesterday, but the softer prices did spur strong movement of 438.47 loads.
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