Market Snapshot, Noon CT (VIP) -- September 18, 2013

September 18, 2013 06:55 AM

Corn futures are fractionally to 1 cent lower.

  • Corn futures saw slight early gains on light short-covering this morning but have slipped into negative territory.
  • Contributing to negative attitudes is the rain that is moving across the Midwest today and forecasts for more widespread showers in the near-term forecast as well as the 6- to 10-day outlook.
  • Harvest is barely underway but basis is declining at interior Corn Belt points in anticipation of harvest pressure. The weakening basis is also weighing on futures.
  • News Lanworth increased in its U.S. corn production estimate by 87 million bu. to 13.483 billion bu. with an average national yield of 152.9 bu. per acre is also limiting buying.
  • Weekly ethanol production fell 10,000 barrels per day (bpd) to 838,000 bpd the week ended Sept. 13. Ethanol stocks fell 91,000 barrels to 16.18 million barrels.
  • Traders expect the Fed will announce mild tapering of its bond-buying stimulus measures this afternoon. Any reduction in stimulus is expected to curb interest in adding risk to investment portfolios by fund managers.
  • Gulf basis is 2 cents lower for immediate delivery in late-morning trade following a 2-cent rise earlier this morning. Basis is a penny higher for October delivery, erasing a penny decline earlier; basis is steady for deferred months.


Soybean futures are 2 to 8 cents higher.

  • A failed retest of support at yesterday's lows is attracting some technical buying.
  • But buying is limited due to rains moving across the Corn Belt and the forecast for more in the the 6- to 10-day outlook, along with above-normal temps. The additional moisture is seen as building yield potential in the late-maturing crop..
  • USDA this morning reported daily sales of 1.93 MMT of soybeans to China and another 182,000 MT of soybeans to an unknown destination -- both for 2013-14 delivery. The market's response has been muted as these sales were likely confirmation of previously announced "goodwill" buys from China.
  • News Lanworth raised its world soybean production forecast by 3 MMT to 281 MMT is also curbing buying interest.
  • Gulf basis is 3 cents lower for immediate delivery, 1 cent higher for October delivery, 8 cents stronger for November delivery and steady for December and January delivery.


All flavors of wheat futures have softened to mixed trade at midday.

  • Futures are higher on ideas the market is due for a bounce but weakness in corn is limiting gains.
  • Limiting buying interest, especially in HRW wheat, are the improved planting conditions across the Southern Plains thanks to recent rains.
  • Tempering gains is today's report Lanworth raised its world wheat production forecast by 2 MMT to 704 MMT, citing improved crop prospects in Kazakhstan and Russia.
  • Gulf SRW wheat basis is unchanged in late-morning trading.


Live cattle futures are slightly lower while feeder cattle futures are slightly higher.

  • Cattle futures are marking time as traders wait on cash trade to develop. Meanwhile October futures are seeing light pressure due to their premium to last week's cash cattle trade at $123.
  • After a lackluster boxed beef performance earlier this week, the market showed some strength this morning. Choice boxed beef is up 29 cents and Select is up 86 cents. Movement is a positive 130 loads.
  • Meanwhile, showlist estimates are sharply higher in Nebraska this week, but down in Texas, Kansas and Colorado.
  • Traders are also beginning to prepare for Friday's Cattle on Feed Report, which is expected to show all categories well below year-ago levels, with Placements expected to come in at 91.6% of last year.
  • Feeder cattle are slightly higher on the slight losses in corn futures.


Lean hog futures continue to post slight losses in nearby contracts, while deferred months have improved to mixed trade.

  • Light follow-through selling is taking place today as traders look for the seasonal decline cash and wholesale pork prices to begin.
  • The pork product market is only partially cooperating as it shows a decline of 65 cents this morning but movement is very strong at 277.34 loads, suggesting demand continues to be strong at current prices.
  • Recent slaughter runs continue to run below expectations with the result being steady to $1 higher cash hog bids.
  • Limiting selling pressure in October futures is its $4-plus discount to the cash index.
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