Market Snapshot, 8:30 am CT (VIP) -- March 21, 2013

March 21, 2013 03:34 AM

Corn futures are marginally to 4 cents lower, with nearbys leading losses.

  • Profit-taking pressure is being seen in old-crop corn futures, although no technical chart damage has been done to suggest a near-term high has been posted.
  • But traders are reacting to this morning's weekly export sales report that showed sales of just 92,200 MT for 2012-13 and sales of 183,300 MT for 2013-14.
  • Traders are concerned the combination of the recent rally in corn futures and the overall strengthening of the dollar will slow already lackluster export demand for corn.
  • Gulf corn basis is 3 to 5 cents lower for near-term delivery. March delivery basis stands 62 cents over May futures.


Soybean futures are mostly 3 to 6 cents higher on corrective trade.

  • Soybean futures are being limited by ongoing shipping delays in Brazil and spreading with corn.
  • News that China plans to sell between 1 MMT and 1.5 MMT of state soybean reserves to crushers due to shipping delays in Brazil is also providing support, as traders believe it opens the window for the U.S. shipping season even a bit longer as we remain the most reliable source of beans on the globe.
  • This morning's weekly export sales report showed sales of 107,800 MT for 2012-13 and sales of 234,000 MT for 2013-14 -- well below traders' expectations.


Wheat futures are mostly 3 to 7 cents lower at all three exchanges on concerns about demand.

  • The fear is strength in the U.S. dollar index, which posted a sharp late-winter rally, will slow demand for U.S. wheat, especially given the plentiful global stocks situation.
  • This was reflected in this morning's weekly export sales data, as sales of 484,500 MT for 2012-13 and sales of 88,800 MT for 2013-14 were well below traders' expectations. Old-crop sales were down 46% from last week.
  • Meanwhile, the greening crop in the Central and Southern Plains needs moisture to sustain it, and there's little in the forecast.


Live cattle futures are called steady to firmer on corrective trade.

  • Live cattle futures are expected to build on yesterday's gains, but strength will be hard fought as traders remain concerned about demand.
  • Choice boxed beef values slipped 77 cents and Select declined by 62 cents yesterday, but the good news is movement improved to 195 loads.
  • Light cash cattle trade in the Southern Plains was reported yesterday at $125, which is down $1 to $2 from the previous week and is expected to set the tone for remaining sales.
  • April live cattle are trading at around a dollar premium to the cash market, which is a fairly tight spread given the tight supply situation.


Lean hog futures are called steady to lower on weakness in the pork cutout market.

  • Pork cutout values slipped $2.03 yesterday to trim packers' profit margins and heighten concerns about pork demand.
  • As a result, the cash hog market is called steady to $1 lower as packers say they are having no difficulty securing supplies and are working on improving margins.
  • Pressure on futures, however, should be limited given the oversold condition of the market.
  • Yesterday's high-range close gives a clue that traders view the downside as overdone, but they need to see improvement in the pork cutout market before they are willing to aggressively rebuild long positions.
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