Market Snapshot, Noon CT (VIP) -- October 7, 2013

October 7, 2013 05:13 AM

Corn futures are 1 to 3 cents higher in early trade.

  • Light short-covering is lifting the corn market this morning, as is spillover support from the wheat market.
  • Rains over the weekend slowed corn harvest, but with USDA closed, the market will not receive official crop progress data this afternoon.
  • Nevertheless, a Reuters poll of analysts shows they expect harvest was likely 20% complete as of Sunday. Last week, USDA said corn harvest was 12% complete.
  • Warmer, dryer weather this week is expected to encourage an uptick in harvest progress.
  • Gulf corn basis slid a penny for November delivery and 3 cents for early 2014 delivery, signaling the availability of 2013 supplies is increasing.


Soybean futures are 1 to 3 cents lower through the July contract.

  • Soybeans are seeing light profit-taking after last week's recovery. The market is also seeing some spread unwinding with corn.
  • Weekend rains slowed harvest, but traders will not get official progress data this afternoon from USDA due to the government shutdown. Analysts expect harvest advanced to 22% complete from 11% done the week prior.
  • Conditions this week are expected to be favorable for harvest activity to resume.
  • Yield reports will be closely monitored as official report data from USDA is lacking. Export demand is thought to be strong, but that is factored into prices.
  • It's unlikely the government will reopen in time for the important October Crop Production and Supply & Demand Reports originally scheduled for Friday.


Wheat futures are 4 to 6 cents higher in the winter wheat market, while HRS wheat is up 2 to 4 cents.

  • The wheat market continues to benefit from ideas U.S. wheat demand remains strong, though confirmation of this from USDA remains lacking due to the shutdown.
  • Also, concerns about planting delays in Russia and frost damage in Argentina have raised expectations that more buyers will be coming to the U.S. to meet their needs.
  • Russian private firm SovEcon has lowered its winter grains seedings forecast to 13 million to 13.5 million hectares. The Russian ag ministry forecasts winter grains seedings at 16.4 million hectares (39.5 million acres).
  • A weaker U.S. dollar index and strength in the corn market is also supportive for wheat futures this morning.
  • Recent technical chart improvement gives bulls the upper hand to start the week.


Live and feeder cattle futures are off to a narrowly mixed start with most contracts favoring the downside.

  • Cash cattle trade took place at mostly $126 at all locations last week, which was steady with week-ago prices. Sales at $1 to $2 lower prices took place in the Nebraska dressed market.
  • Nearby futures are at a premium to those cash prices, limiting buying interest.
  • But on the other hand, a lack of government data and ideas supplies will continue to tighten are limiting selling interest.
  • According to Urner Barry, Choice boxed beef values fell 18 cents on Friday, while Select firmed 43 cents.
  • The lack of USDA's daily boxed beef updates means showlists estimates will take on even greater importance as traders formulate cash trade expectations.
  • Strength in the corn market is putting light pressure on feeder cattle futures.


Lean hog futures are choppy this morning.

  • The lean hog market continues to benefit from a technical chart posture that still favors market bulls.
  • The market rebounded last week after an initial bearish reaction to the Hogs & Pigs Report, signaling traders remain convinced the porcine epidemic diarrhea virus (PEDV) is having a greater impact than reflected by report data.
  • The lack of USDA data adds to near-term price direction uncertainty.
  • Early cash hog bids are steady to lower as supplies are expanding.
  • Urner Barry's slaughter estimates show last week's kill rose slightly from the week prior.
  • Packers are thought to be enjoying wide profit margins.
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