Watching Outside Markets, Exports and Europe

October 20, 2011 02:11 AM
 

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Overnight highlights. Following are highlights of overnight trade:

Corn: Marginally to 1 cent lower. Futures saw light followthrough pressure in overnight trade after yesterday's late selloff. The U.S. dollar index is weaker this morning and crude oil is slightly higher, but gold is sharply lower this morning as investors keep a close eye on the euro-zone. The bloc is working on increasing its funding to banks to avoid a default. Attitudes toward reaching a deal continue to shift, maintaining a choppy tone in the corn market.

Soybeans: 1 to 4 cents lower. Futures saw followthrough pressure from yesterday's sharp losses amid rumors China has cancelled bean purchases. Recent strength in Gulf basis suggests export demand has picked up and doesn't suggest any washouts. Traders will have a watchful eye on this morning's weekly export sales data which is expected to show a strong sales tally.

Wheat: Mixed. Futures were mixed overnight, but weakness in the U.S. dollar index helped to firm nearby futures. Look for price action in the wheat pit to be choppy today as traders keep a close eye on outside markets, developments in the euro-zone, neighboring pits and this morning's weekly export sales data.

Live cattle: Mixed. Futures are expected to be mixed as traders wait on cash cattle trade to begin. This morning's weekly export sales data will also influence the market, as traders recognize the strong export pace is helping to tighten supplies. Traders will also begin to more aggressively even positions ahead of tomorrow afternoon's Cattle on Feed Report, expected to show On Feed nearly four percentage points above year-ago levels.

Lean Hogs: Steady to firmer. Futures are expected to see a boost from the pork cutout market, which surged $1.89 yesterday to lift the market above $100 per cwt. Movement of pork was strong on the increase in price, suggesting demand is strong. This helped to improve packers' profit margins and should support the cash market today as well.


 

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