Market Snapshot, 8:30 am CT (VIP) -- August 31, 2012

August 31, 2012 03:38 AM
 

Corn futures are narrowly mixed this morning, with pressure limited by weakness in the U.S. dollar index.

  • Focus is on end-of-the-month position squaring. Traders are known to lighten their long exposure to the market ahead of an extended holiday weekend -- especially given a lack of fresh news.
  • The U.S. dollar index is sharply lower this morning ahead of Federal Reserve Chairman Ben Bernanke's address in Jackson Hole, Wyoming. Investors have high expectations he will make bold statements about future policy.

 

Soybean futures are 9 to 16 cents lower amid light profit-taking after yesterday's contract highs.

  • Soybeans rose to contract highs yesterday as traders realize high prices have not slowed demand dramatically. But some profit-taking is being seen ahead of the holiday weekend and as traders close their books for the month.
  • Positive outside markets could attract "value buying" to the soybean pit this morning at the start of open outcry trade.

 

Wheat futures are mostly 2 to 5 cents lower on news Russia won't resist grain exports.

  • Russian officials say there's no need to restrict grain exports, but its ag ministry cuts its grain crop forecast to 70 million metric tons (MMT) to 75 MMT after lowering it to 75 MMT last week.
  • But pressure on futures has been limited due to sharp weakness in the U.S. dollar index, as more focus is being put on the need for fresh monetary stimulus.

 

Live cattle futures are called mixed as traders wait on cash cattle trade.

  • Traders are still waiting on active cash cattle trade to begin; most look for steady to lower trade to begin this afternoon as packers' demand is lackluster ahead of the holiday weekend.
  • Beef prices have drifted lower this week, but movement has been solid, signaling packers will be featuring beef after Labor Day.
  • Traders are also keeping a close eye on outside markets ahead of Fed Chairman Ben Bernanke's remarks later this morning. The Dow Jones Industrial Average is expected to open higher.

 

Hog futures are called steady to weaker on continued cash market weakness.

  • The cash hog market is called steady to lower again this morning due to plentiful supplies. Packers have worked to improve profit margins, which is helping to keep kill lines running as full as possible, which is especially helpful given increased sow liquidation.
  • Pressure on futures, however, could be limited by pre-weekend positions squaring and the sharp discount nearby futures hold to the cash index.
  • Positive outside markets should help to limit pressure on lean hog futures.
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