Corn futures are 10 to 14 cents lower amid profit-taking and negative outside markets.
- Strength in the U.S. dollar index amid disappointment the European Central Bank (ECB) left its key interest rates unchanged and refrained from announcing a fresh stimulus plan is weighing on corn futures.
- Traders are also opting to take some profits out of the market, as the near-term forecast is more hopeful of rain to help fill the crop.
- This morning’s weekly export sales data showed corn sales of 178,400 metric tons (MT) for 2011-12 and 23,000 MT for 2012-13, which was above very low expectations.
- USDA announced Mexico purchased 982,980 MT of corn for 2012-13 and 533,400 MT for 2013-14.
August through March soybean futures are 20 to 31 cents lower, with far-deferred contracts posting lighter losses.
- Forecasts calling for for some beneficial rain for filling soybeans are weighing on soybeans.
- Soybean futures are also weaker on dollar strength due to disappointment the ECB didn’t announce a fresh stimulus plan and sharp losses in crude oil.
- This morning’s weekly export sales report showed soybean sales of 194,000 MT for 2011-12 and 52,400 MT for 2012-13. Combined, the tally came in below expectations and is adding to weakness in the market. However, China and unknown destinations were the lead buyers.
- Meanwhile, soymeal exports of 332,100 MT were a new marketing-year high.
Chicago and Kansas City wheat are mostly 7 to 14 cents lower, with Minneapolis down mostly 3 to 8 cents.
- Wheat is seeing spillover from neighboring markets and strength in the US dollar index. With little fresh news for traders to digest, wheat continues to closely track corn.
- Traders remain concerned about the size of the global crop, but this is mostly factored into the market.
- Weekly export sales of 516,200 MT for 2011-12 and 4,500 MT for 2012-13 were within expectations.
Live and feeder cattle futures are called higher in reaction to corn market weakness.
- Weakness in the corn market is seen as supportive for livestock futures this morning. Feeder cattle futures, in particular, are expected to be bolstered by signs the market is working on a near-term high.
- Expectations are for $1 to $2 higher cash trade compared with last week’s $114 trade, but nearby futures are already trading at a premium to those expectations.
- Boxed beef prices were slightly lower yesterday, but movement continues to pick up this week, with 255 loads changing hands yesterday.
- Weekly beef exports of 15,800 MT were up from the previous week.
Lean hog futures are called to open higher in reaction to strength in pork cutout market.
- The pork cutout value was $2.12 higher yesterday on improvement in ham and belly prices. Movement of 117.5 loads signals a near-term low may have been posted.
- October lean hogs will soon be the lead-month contract and are trading at a steep discount to the cash index.
- Upside potential may be limited by talk of stepped-up sow liquidation, as well as expectations supplies will soon begin to build seasonally.
