Market Snapshot, 8:30 am CT (VIP) -- September 17, 2012

September 17, 2012 03:38 AM

Corn futures are 9 to 18 cents lower, with the December through July contracts leading the price decline.

  • A lack of fresh news and a slightly firmer U.S. dollar index resulted in stepped-up selling in the corn market overnight.
  • Harvest-related hedge pressure is also a factor this morning. Traders expect this afternoon's progress report to show around one-quarter of the corn crop has been harvested as of Sunday.
  • December corn futures are nearing support at last week's low of $7.59 1/4.


Soybean futures are 16 to 30-plus cents lower, with nearby contracts leading losses amid profit-taking.

  • While still in a bearish formation, the U.S. dollar index is seeing light short-covering this morning as investors take a breather from last week's Fed-inspired rally. This is contributing to selling in the soybean market.
  • November soybeans are pivoting around $17.00 as harvest-related hedge pressure is likely to increase this week.
  • USDA announced a daily sale of 210,000 metric tons of soybeans to an unknown destination for 2012-13. That should help limit selling.
  • Tight global stocks should also help to limit pressure. Too-dry conditions in Mato Grosso, Brazil, have delayed the start of planting.


Wheat futures are seeing double-digit losses at all three exchanges on spillover from neighboring markets.

  • A lack of fresh news has traders focused on profit-taking as wheat is seeing spillover from the corn and soybean markets.
  • Meanwhile, the Australian government says stocks of wheat are tightening. Total wheat stocks were down 20.1% from July and 7.1% lower than year-ago.
  • December Chicago wheat is holding above the $9.00 level, which has served as a pivot point since mid-July.


Live cattle futures are called mixed as traders wait on direction from the boxed beef market.

  • Look for price action to be choppy as traders wait to see how the boxed beef market performs to start the week. Continued strength in the product market may be needed to trigger steady to firmer cash cattle prices as packer margins are in the red.
  • As a result of squeezed profit margins, packers may scale back their slaughter schedules, which puts even more pressure on the boxed beef market to perform.
  • Feeder cattle futures are expected to see a firmer start on help from weakness in corn.


Lean hog futures are expected to favor a firmer tone as traders keep a close watch on the pork product market for a near-term low.

  • The pork cutout value firmed late last week, which is raising expectations the cash market may stabilize soon.
  • The cash hog market is expected to be mostly steady this morning, although plentiful supplies mean packers have little incentive to raise bids despite profitable margins.
  • Weakness in the corn market is also supportive as traders hope it slows sow liquidation.
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