Corn futures have improved to trade slightly higher in old-crop futures, while new-crop futures now just 3 to 4 cents lower in most contracts.
- Corn futures faced selling pressure early this morning, but this has since given way to bargain buying amid ongoing concerns about a slow start to the 2013 growing season.
- Just 5% of the U.S. corn crop was planted as of Sunday, and precip and chilly temps the rest of the week are expected to remain a drag on planting progress.
- Light support also comes from ongoing signs of improved domestic corn demand. Ethanol output last week rose 4,000 barrels per day (bpd) from the week prior to 857,000 bpd. Ethanol stocks fell by 600,000 barrels last week to 17.0 million barrels.
- Traders expect tomorrow's Weekly Export Sales Report to reflect recently improved export demand as it will likely include recent daily sales to China.
Soybean futures are 18 to 20-plus cents lower in old-crop futures, while new-crop futures are posting losses around 13 to 15 cents.
- While some light short-covering has moved bean futures off their early lows, bears remain in control of the market thanks to the likelihood some corn acres will be switched to soybeans due to planting delays.
- The market's inability to find followthrough buying after yesterday's strong finish is also encouraging some technical selling.
- Funds are increasing their short position in beans to start the month.
- Also, Gulf soybean basis fell 10 cents for immediate delivery this morning, signaling slower demand and increased farmer selling. Gulf basis held steady at midday.
- Weak Chinese manufacturing data adds to ideas the country's feed demand will slow due to economic headwinds made even greater by the bird flu situation there.
Wheat futures have improved to trade just 3 to 6 cents lower in Chicago, while Kansas City and Minneapolis wheat are favoring the downside in choppy trade.
- Spillover from corn and soybeans is encouraging profit-taking in the wheat market today.
- This comes despite projections from the first day of the Wheat Quality Council's HRW wheat tour for an average yield of 43.8 bu. per acre in central and northern Kansas and far southern Nebraska, which was well below 53.4 bu. per acre last year and a five-year average projection of 44.2 bu. per acre.
- Results from the tour are expected to be worse today as scouts are taking samples from western and southern Kansas, where crops suffered greater drought and freeze damage.
- And more damage may lie ahead; there are freeze warnings for the Southern and Central Plains tonight and tomorrow.
- Meanwhile, spring wheat planting will remain on hold for some time, as the Northern Plains is seeing heavy precip including snow today.
Live cattle futures have improved to mostly moderately higher trade in all but far deferred contracts. Feeder cattle futures are slightly to moderately higher.
- Live cattle futures are benefiting from a surge in boxed beef prices this morning, signaling retailers are increasing their beef features. Choice cuts rose $2.51 this morning and Select cuts jumped $1.86. Perhaps even more significant, movement was solid at 107 loads.
- This is adding to expectations for firmer cash cattle trade compared with last week's mostly $128 action on the Southern Plains.
- Nearby futures are at nearly a $5 discount to last week's prices, opening upside potential.
- Also, showlist estimates are tighter this week and packer profit margins have improved, though they remain in the red.
- Feeder cattle futures are enjoying spillover from live cattle and short-covering on weakness in the corn market today.
Lean hog futures have improved to trade steady to slightly higher through the July contract; deferred months are under light pressure.
- Cash hog bids are mostly firmer again today amid improved demand and tightening market-ready supplies. The winter storm event and fieldwork activity is also making it harder for packers to secure needed supplies.
- The pork cutout value rebounded this morning, rising $1.43. Movement also improved to 318.8 loads -- already within 13 loads of yesterday's total for the day.
- Also, the cash hog index continues to rise, easing any urgency to narrow the $6 premium the May contract holds to the index.
- While the number of market-ready hogs are tightening seasonally, average hog weights in Iowa and southern Minnesota rose 0.9 lbs. last week, emphasizing improvement in production efficiency. This is adding a note of caution, especially as some packers have seen margins dip into the red this week.