Market Snapshot, 8:30 am CT (VIP) -- December 13, 2012

December 13, 2012 02:50 AM

Corn futures are narrowly mixed, with pressure limited by spillover from neighboring pits.

  • Pressure on corn is being limited by strength in neighboring soybean and wheat pits, but a slightly firmer U.S. dollar index is limiting buying.
  • Traders looking to this morning's weekly export sales data for inspiration were disappointed by sales of 258,900 MT for 2012-13 and 13,700 MT for 2013-14. While this was within expectations, export commitments (sales plus exports) are running well behind the pace needed to reach USDA's export projection.
  • Gulf corn basis is 4 to 6 cents lower for nearby delivery, which signals export demand remains lackluster.


Soybean futures strengthened on stronger-than-expected weekly export sales to trade 4 to 8 cents higher.

  • This morning's weekly export sales data showed sales of 1,319,400 MT for 2012-13, which is a new marketing year high. Sales to China topped 1 MMT.
  • USDA left its export projection unchanged in this week's S&D Report, but the current total export commitment pace of 32% ahead of year-ago is well above USDA's projected 1.2% drop from year-ago.
  • Gulf soybean basis is steady to 5 cents higher for winter delivery, which reflects the tight supply situation.
  • Meanwhile, improved weather across Brazil has limited buying so far this week in the soybean market, as traders expect China's focus to shift to Brazilian supplies by mid-January when its early planted soybeans become available.


Wheat futures are mostly 2 to 4 cents higher on short-covering given ideas recent sharp losses are overdone.

  • Following back-to-back days of sharp price pressure in the wheat market, traders are opting to cover short positions. But bulls have their work cut out in order to improve the technical makeup of the market.
  • Also helping to lift futures is this morning's weekly export sales data. Sales of 518,600 MT for 2012-13 and 54,900 MT for 2013-14 came in above expectations.
  • Export commitments are running 9% behind year-ago and USDA expects exports to be even with the previous marketing year.
  • This morning's drought monitor showed slight improvement in the Southern Plains, although it came along the Texas coast. The monitor notes that continued dryness has negatively impacted the winter wheat crop.


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

  • Yesterday's setback in live cattle futures and mixed tone in the boxed beef market has put this week's cash cattle trade in question. Choice beef values slipped 39 cents yesterday and Select rose 67 cents on strong movement of 200 loads.
  • Traders expect cash trade to be delayed until tomorrow as bids and asking prices remain several dollars apart.
  • Weekly beef export sales of 12,700 MT for 2012 and 2,100 MT for 2013 are down from last week.


Lean hog futures are expected to be higher on strength in the export market.

  • Traders point to data released earlier in the week by USDA as supportive for lean hog futures, as exports in October were a new record for the month in terms of volume and value.
  • Meanwhile, the cash hog market is called steady to $1.50 lower amid slow demand.
  • Packers say they are having no difficulty securing needed supplies, which could limit buying in nearby futures.
  • But with December lean hog futures trading at around a $2.50 discount to the cash index ahead of its expiration at noon CT tomorrow, there is more room to the upside.
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