Market Snapshot, Noon CT (VIP) -- October 4, 2013

October 4, 2013 07:12 AM

Corn futures are 1 to 3 cents higher.

  • Light short-covering ahead of the weekend continues to dominate trading this morning. The lack of official data due to the government shutdown also has traders reluctant to aggressively push futures in either direction and encouraged other traders to vacate the market.
  • The trade is absorbing reports Informa Economics increased its corn yield estimate to 158.8 bu. per acre from 157.6, and raised its production forecast to 14.010 billion bushels from 13.889 billion bushels. These compare to USDA's forecasts of 13.843 billion bu. with an average yield of 155.3 bu. per acre.
  • Harvest is being slowed by rains and, yep, even some snow up in the Dakotas, which are moving across the Corn Belt today. The slowdown in the late-starting corn harvest has resulted in mixed corn bids across the Midwest as supplies are tight.
  • The market is unlikely to receive a USDA update on harvest progress Monday due to the government shutdown.
  • Export demand rose this week, signaling foreign buyers see value on the price break. But South Korea passed on a tender to buy 140,000 MT of optional origin corn overnight.
  • Gulf basis unchanged in late-morning trading. Basis was 5 cents stronger for October delivery in early morning trading and 2 cents higher for November delivery. Deferred delivery periods were unchanged.


Soybean futures are now mostly 7 to 9 cents higher.

  • Soybean futures have risen on the reports private analytics firm Informa Economics pared its estimate of both the average soybean yield and total crop production. Informa reportedly projects a total 2013 soybean harvest of 3.176 billion bu., with a yield of 41.7 bu. per acre. The figures are below Informa's Sept. 20 estimates of a 3.224 billion bu. crop and a yield of 42.4 bu. per acre. These compare to USDA's September forecast of a soybean crop of 3.149 billion bu. with a yield of 41.2 bu. per acre.
  • Traders are also evening positions ahead of the weekend and amid a lack of followthrough selling following Monday's selloff on the bearish Grain Stocks Report.
  • Harvest is building, although a breakout of rain across the Corn Belt will hamper harvest progress through the weekend.
  • Taiwan tendered to buy 40,000 to 60,000 MT of soybeans each from the U.S. and Brazil overnight.
  • Gulf basis bids are unavailable today.


SRW wheat futures at mixed from 1 cents weaker to 3 cents higher in bear spreading; HRW is 2 cents lower to 3 cents higher in bear spreading; HRS is 1 to 6 cents higher.

  • Wheat futures are getting some support from reports private analytics firm Informa Economics lowered its estimate for Argentina's 2013-14 wheat harvest by 2.7 MMT, to 11 MMT, which is below USDA's forecast of 12 MMT.
  • The market is also finding support from comments by Ukraine's ag minister who says the country's wheat crop could be cut by one-third to around 15 MMT from around 22 MMT this year.
  • However, Ukraine's ag ministry also reports his country's grain exports through Oct. 4 have risen 11.5% from year-ago to 6.3 MMT, thanks to stronger wheat and barley exports. The ministry forecasts exports between 26 MMT and 30 MMT for 2013-14, versus 23 MMT the previous season.
  • Statistics Canada raised its wheat crop estimate to a record 33.026 MMT, which is 22% higher than year-ago and above the average pre-report guess of 32.9 MMT. This is limiting buying interest.
  • Gulf basis bids are unavailable today.


Live cattle futures are mostly higher. Feeder cattle are mixed with an upside bias after opening under pressure.

  • Traders are shrugging off reports cash cattle trade got underway yesterday at steady to lower prices in Nebraska, while sales in Kansas and Texas took place at $126, which was steady with week-ago.
  • Traders had been looking for cash prices to firm, but packers have seen margins drop into the red after paying higher prices for animals the previous two weeks and resisted higher offers.
  • The lack of government-based data has prompted traders to turn to private sources for information on wholesale beef prices. Urner Barry reports Choice boxed beef prices were 72 cents higher Thursday, while Select beef was $1.03 higher.
  • Feeder cattle futures are mostly firmer on the turn to the plus side in live cattle futures.


Lean hog futures are slightly to moderately higher

  • Light corrective short-covering continues to dominate trading. The lift in prices continues to probe the large downside gap left Monday in the wake of last Friday's bearish Quarterly Hogs & Pigs Report.
  • Traders continue to question the report thinking it showed far less impact from PEDV than expected.
  • Slaughter is expected to be down from year-ago this week, adding to questions about the report data.
  • Cash hog bids are mostly steady across the Midwest today.
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