Market Snapshot, Noon CT -- (VIP) -- November 13, 2013

November 13, 2013 05:52 AM

Corn futures continue to see losses of 1 to 3 cents this morning.

  • A lack of fresh news today leaves the market vulnerable to profit-taking.
  • Traders are unconcerned about the forecast for rain this weekend as USDA reports harvest is moving into its final stages at 84% complete as of Sunday.
  • Meanwhile, slow farmer selling has resulted in steady to higher basis at interior locations today.
  • While farmers are harvesting a record-large crop, demand is being rebuilt. Traders will have to wait until Friday to get on update on weekly export sales demand due to the federal holiday Monday.
  • Renewed talk EPA may propose a lower ethanol mandate of the Renewable Fuels Standard in the near future is putting light pressure on the market.
  • News Lanworth raised its U.S. corn production forecast by 6 million bu. to 13.944 billion bu. today adds to the negative tone.

Soybean futures are mixed, with nearbys 1 to 2 cents lower on profit-taking.

  • Soybean futures have improved to mixed trade, although nearby futures remain under light profit-taking pressure.
  • Indications that interior basis levels have improved is helping to lift futures to mixed levels.
  • After slipping this morning, Gulf soybean basis has improved to steady to 2 cents firmer for immediate delivery.
  • Basis improvement is a reminder that demand is strong. This morning, USDA announced China bought 123,000 MT of soybeans for 2013-14 delivery.
  • Also, Lanworth trimmed its U.S. soybean production forecast by 6 million bu. to 3.287 billion bushels.
  • Soybean harvest was a bit less advanced than traders anticipated at 91% complete as of Nov. 10, but since harvest is in its final stages and near in line with the five-year average pace, concern about finishing it off are limited.

SRW wheat futures are narrowly mixed, with HRW and HRS mostly 1 cent lower.

  • Buying is being limited by weakness in the corn market, although a weaker U.S. dollar index is helping to limit pressure.
  • HRW futures are being pressured by the solid start for the crop. Yesterday's crop condition report showed the crop continues to improve.
  • Also, China National Grain and Oils Information Center (CNGOIC) says it expects the country to import 8 MMT of wheat in 2013-14 to make up for the shortfall of its own crop. This would be the highest level since 1995.
  • But firms in Australia and France slightly increased production estimates in the countries, which reminds traders for increasing global competition.
  • Wheat futures are hovering above important support level, which tells that bears still have the upper hand.

Live cattle have firmed to trade steady to slightly higher through the August contract. Feeder cattle have also reversed early losses to trade slightly higher.

  • Live cattle futures gapped lower on the open, but this has since given way to bargain buying. A high-range close would result in bullish reversals.
  • Traders are encouraged by signs slightly softer boxed beef values of late (though Choice cuts remain above $200 per cwt.) are rebuilding demand.
  • This morning, Choice cuts firmed 39 cents and Select fell 21 cents and a strong 120 loads changed hands.
  • Cash cattle trade has yet to get underway, but heavier showlist estimates could result in steady to lower cash action this week. This is limiting buying interest in nearby futures, which are already at a premium to last week's prices.
  • Softer corn prices and gains in live cattle are making it easier for feeder cattle futures to rally.

Lean hog futures are moderately lower at midday.

  • Lean hog futures have sustained technical chart damage in recent weeks. This along with today's downside gap have encouraged some technical sales.
  • The cash market has for the most part trended steady to lower of late as supplies are on the rise. However, strong packer demand has resulted in scattered higher bids this week.
  • Average hog weights rose 1.1 lbs. last week in Iowa and southern Minnesota.
  • The pork cutout value slid another $1.25 this morning. However, this spurred impressive movement of 359.01 loads. This morning tally tops many daily tallies of recent weeks.
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