Market Snapshot, 8:30 am CT (VIP) -- January 3, 2013

January 3, 2013 02:43 AM
 

Corn futures are 4 to 9 cents lower on followthrough from yesterday's losses.

  • Corn futures are seeing followthrough from yesterday's low-range close, as well as pressure from negative outside markets.
  • The U.S. dollar index is stronger this morning as investors brace for tomorrow's key monthly employment report. This is triggering widespread selling in the commodity world.
  • Gulf corn basis is steady to 1 cent firmer, but there's no fresh export news to digest.
  • March corn violated support at the December low of $6.87 1/2. A close below this level and filling the early July gap area at $6.83 1/2 would open fresh downside risk.

 

Soybean futures are 15 to 19 cents lower on negative outside markets and news of more Chinese sales cancellations.

  • Soybean futures are seeing followthrough pressure after futures posted bearish reversals yesterday. Dollar strength is adding to the negative tone.
  • Futures slipped further on news China canceled 315,000 MT of U.S. soybean sales for the current marketing year. This comes as harvest begins in Mato Grosso, Brazil.
  • While dry conditions threaten pod-filling beans in Mato Grosso, rains in central and southern Brazil this week maintain an outlook for a record Brazilian soybean crop.
  • January beans appear headed for a test of support at the December low of $13.72 1/4.

 

Chicago wheat futures are mostly 1 to 5 cents lower. Kansas City and Minneapolis wheat are narrowly mixed, with nearbys favoring the upside.

  • Wheat is largely being pressured by spillover from neighboring pits, but losses are being kept in check on ideas the downside has been overdone.
  • But without fresh export news for the market to factor in, it will be difficult for wheat to rally on its own, especially given the negative posture of outside markets this morning.
  • March Chicago wheat futures is pivoting around support at yesterday's low of $7.52 1/2, which lines up closely with the May high of $7.54 1/2.

 

Live cattle futures are called mixed as traders await direction from the cash market.

  • Traders in the cattle pit are waiting on clearer direction from the cash market. General expectations are for steady to higher trade compared with last week's $127 trade, although no active bidding has been reported.
  • Beef prices were mixed yesterday, with Choice down 21 cents and Select up $1.57 on so-so movement of 148 loads.
  • Negative outside markets will limit buying in the cattle pit, as the U.S. stock market is set to open lower on profit-taking after yesterday's surge.
  • Feeder cattle futures are expected to see a lift from weakness in the corn market.

 

Lean hog futures are called to open steady to weaker on concerns about the cash market.

  • Futures are expected to be weaker this morning due to weakening packer profit margins. Pork cutout values slipped $1 yesterday, which raises concern about packer demand for cash hogs.
  • Traders are also expected to narrow the premium nearby futures hold to the cash market.
  • But pressure should be limited as the cash hog market is expected to be mostly steady today, with some firmer undertones. Some packers are still in need of supplies to fill this week's holiday shortened kill schedule.

 

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