Winter Wheat Crop Continues to Slip

November 27, 2012 12:34 AM
 

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Overnight highlights. Following are highlights of overnight trade (as of 6:35 a.m. CT) and opening livestock calls:

Corn: 2 to 4 cents higher. Corn is enjoying spillover from the soybean pit, but upside potential is being limited by sporadic export demand. Export sales reported last Friday were strong, but weekly export inspections yesterday reminded the market the pace remains well behind what's needed to reach USDA's export forecast. Still, a stronger-than-usual basis reminds the market of the overall tightness of supplies.

Soybeans: 3 to 10 cents higher. Futures were lifted overnight by strong commercial buying, which hints of more export demand news on the horizon. But upside potential is being limited by a cautious tone in outside markets due to little progress being made by fiscal cliff negotiations. Soybean futures still have a lot of work ahead to improve technicals and January beans need closes above $15.00 to signal a near-term low has been struck.

Wheat: 6 to 7 cents higher. Wheat is seeing a boost from poor winter wheat crop condition ratings. In its last ratings of the year, the condition of the crop declined further due to ongoing drought conditions in the Central and Southern Plains. Meanwhile, U.S. wheat is not competitively priced on the global market, although tightening supplies in the Black Sea region have traders expecting a turnaround in demand in the near future.

Live cattle: Steady to weaker. Futures are expected to be steady to weaker this morning, with upside potential limited by news of light cash cattle trade late yesterday at steady money with last week. Traders are also disappointed by the lackluster start to the week in the beef market, as Choice values slipped 22 cents and Select was down 14 cents on just 119 loads changing hands.

Lean hogs: Steady to weaker. Futures are vulnerable to profit-taking due to the premium nearby futures hold to the cash index. But selling should be limited by better-than-expected packer demand for hogs. Some packers raised bids yesterday, although cash sources say they are having no difficulty securing supplies.


 

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