What Traders are Talking About:
Overnight highlights: As of 6:30 a.m. CT, corn futures are 3 to 5 cents higher in old-crop contracts and 1 to 2 cents lower in new-crop contracts, soybeans are 4 to 9 cents lower and wheat futures are 2 to 7 cents higher, with Kansas contracts leading gains amid HRW crop concerns. Weekly export sales could influence the open at 8:30 a.m. CT. Cattle futures are expected to open with a mixed tone, while hogs are likely to favor a slightly firmer tone on the open.
* USDA raises domestic carryover projections less than expected. USDA added 125 million bu. to its 2012-13 corn ending stocks projection, pushing it to 757 million bu., but that was much less than traders anticipated after March 1 corn stocks came in nearly 400 million bu. higher than expected. Soybean ending stocks were left unchanged at 125 million bushels. Wheat carryover was upped 15 million bu. to 731 million bushels. On the global front, USDA upped its ending stocks projections for corn, soybeans and wheat more than anticipated. Basically, the friendly domestic carryover projections were offset by the negative global ending stocks pegs.
The long and short of it: Corn ending stocks are likely to inch higher now through the end of the 2012-13 marketing year. USDA showed it will likely hold soybean ending stocks at current levels until July or August.
* Another freeze in HRW country. Overnight temps again dropped below freezing in areas of the HRW wheat belt. Generally speaking, the areas that were hardest hit Tuesday night/Wednesday morning -- western Kansas, western Oklahoma and the Texas Panhandle -- also recorded the lowest temps overnight. Fortunately, some of the crop received snow or freezing rain prior to the cold blast that insulated it from the freeze.
The long and short of it: There was obviously some damage, but traders will have to wait at least one to two weeks to get a good damage assessment. And even then, it will be hard for them to quantify how much of a hit the HRW crop took.
* Cold, wet Corn Belt. The Dakotas and Minnesota are getting snow/freezing rain this morning, while the far eastern Corn Belt is seeing the last wave of heavy rains move through. Precip is easing across other areas of the Corn Belt after a heavy deluge the past couple days. While conditions are expected to be drier through Saturday, temps will be below normal. And another wave of rains is forecast to move into the Corn Belt Sunday and last through at least the middle of next week. Cold, wet conditions will keep planters parked across most of the Corn Belt for at least the next couple weeks.
The long and short of it: November soybeans are facing some pressure from thoughts some intended corn acres could get switched to soybeans, but December corn futures are not yet being supported by planting-delay talk. If corn planting is delayed into May, them it would become a greater market focus for corn traders. But for now, the longer-term benefits of the rain are outweighing the shorter-term negatives.
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