Market Snapshot, 8:30 am CT (VIP) -- September 10, 2012

September 10, 2012 03:44 AM

Corn futures are steady to 2 cents lower in choppy trade.

  • Futures are trading near session lows but have seen two-sided trade so far. Key will be if traders view weaker prices as a buying opportunity by the start of open-outcry trade.
  • Harvest progress is curbing buying interest, although disappointing harvest results are limiting selling, which is maintaining a choppy trading tone.
  • Traders' focus early this week will be on evening positions ahead of Wednesday's Crop Production and Supply & Demand Reports. According to the average pre-report trade guess, traders look for the crop to come in near 10.4 billion bushels.


Soybean futures are 5 to 8 cents lower on pressure from profit-taking and the impending harvest.

  • According to official Chinese customs data, the country imported 4.42 million metric tons (MMT) of soybeans in August, down 2% from last year and 24.7% below the previous month. For the first eight months of this calendar year, Chinese soybean imports are up 17.4% at 39.34 MMT.
  • China's trade surplus widened to $26.7 billion in August and its consumer price index upticked 2% from last month. This points to further monetary easing in an attempt to boost economic activity.
  • Traders are also preparing for USDA's Crop Production Report. According to the average pre-report trade guess, a crop of 2.638 billion bu. is expected.


Wheat futures are narrowly mixed, with pressure limited by tight global supplies.

  • Pressure on wheat is being limited by ideas the global supply picture is tightening due to robust exports from the Black Sea region.
  • However, the government of India says it's likely to produce "more than 90 MMT" of wheat this year, which is higher than earlier indicated. The country has exported around 3 MMT of wheat since the export ban was lifted last September and is expected to export another 2 MMT of wheat by year-end.
  • Traders are also working to even positions ahead of Wednesday's Supply & Demand Report from USDA. Traders look for USDA to raise 2012-13 wheat carryover by around 11 million bu. to 709 million bushels.


Live cattle futures are called to open mixed as traders sort through cash details.

  • Cash cattle trade got underway late Friday afternoon and cash sources are still sorting through the details. Trade began in Nebraska at $1 to $2 higher prices than last week, but the amount of cattle sold is uncertain.
  • Traders will be keeping a very close eye on the boxed beef market for this week's cash clues to determine if retailers are still buying beef amid rising pork supplies.
  • Outside markets are choppy this morning, which won't aid cattle futures.


Lean hog futures are called to open steady to lower on continued cash deterioration.

  • Lean hog futures are expected to see price pressure and upside potential is limited to short-covering given ongoing weakness in the cash hog market.
  • Cash hog bids are expected to be mostly $1 lower this morning amid plentiful supplies, which gives packers no incentive to raise cash hog bids despite profitable margins.
  • Pressure on futures should be limited by the discount nearby contracts already hold to the cash index.
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