Market Snapshot, 8:30 am CT (VIP) -- April 4, 2013

April 4, 2013 03:44 AM
 

Corn futures have moved to session lows ahead of the start of open-outcry trade; trading 3 to 4 cents lower.

  • Stepped up profit-taking is being seen this morning due to strength in the dollar index, which keeps demand concerns on traders' minds.
  • This morning's weekly export sales data showed sales of 354,300 MT for 2012-13 and 33,000 MT for 2013-14 -- coming within expectations.
  • Japan was the lead destination, including switches from unknown destinations, followed by Mexico and then China, which also included switches from unknown destination.
  • Traders expect stronger sales in next week's report, as end-users took advantage of recent sharp losses.
  • Meanwhile, Gulf corn basis is steady this morning to stand 53 cents over May futures for immediate delivery. Basis has softened 3 cents for June delivery.

 

Soybean futures are 2 to 9 cents lower, with nearby contracts leading losses.

  • This morning's weekly export sales data, which showed sales above expectations, is helping to limit losses.
  • Sales of 392,700 MT for 2012-13 and 355,100 MT for 2013-14 came in above expectations, but traders expect old-crop sales to continue declining as end-users' focus turns to the record South American crop.
  • Traders are also keeping an eye on the Chinese bird flu situation, as it raises concerns about the country's feed demand.
  • Gulf soybean basis is steady this morning to stand 75 cents above May futures for immediate delivery.

 

Wheat futures are 6 to 13 cents lower amid profit-taking following yesterday's double-digit gains.

  • Wheat futures are seeing profit-taking following yesterday's gains. Traders yesterday responded to talk China has bought up to 10 cargoes of U.S. wheat due to quality concerns with the Canadian crop.
  • Meanwhile, traders are disappointed by this morning's weekly wheat sales report that showed sales of 141,200 MT for 2012-13 and 174,800 MT for 2013-14. A new marketing-year low for old-crop sales is a big disappointment to traders.
  • Helping to limit losses are ongoing concerns about the U.S. HRW wheat crop. This week's drought monitor showed only minor improvement in the Southern Plains.

 

Cattle futures are called mixed as nearbys are trading in line with the cash market.

  • Cash cattle trade turned moderately active yesterday, with just followup trade expected today at $128. April live cattle are trading in line with this week's cash trade.
  • Meanwhile, concerns about demand continue to linger, although boxed beef movement picked up to 200 loads yesterday.
  • USDA reports for the week ended March 28, weekly beef sales of 10,500 MT were down 39% from the previous week, which further heightens concerns about beef demand.
  • Feeder cattle futures should benefit from weakness in the corn market.

 

Lean hog futures are called slightly higher on followthrough from yesterday's late-session gains.

  • Lean hog futures posted a late-session surge yesterday, which sets the stage for followthrough buying this morning.
  • But upside potential will be limited as nearby futures are trading at a steep premium to the cash hog index.
  • While the pork cutout market so far this week has been lackluster, traders expect retailers to begin featuring pork, which is more competitively priced than beef, for the grilling season.
  • For the week ended March 28, USDA reports pork export sales of 48,400 MT, with Mexico the lead buyer.
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