Market Closes - April 12, 2013

Posted on Apr 12, 2013
Despite sharply lower prices for non-agricultural commodities today, CBOT futures closed strongly higher. Weak economic data for the U.S. and growing concern about the weaker Eurozone countries combined to lower expected global demand for energy. Gold and silver prices were hit very hard. Gold price is down more than 20 pct from its record high set in 2011. Cyprus is reportedly selling its gold reserves, so traders may fear that other weak EU countries might have to do the same in the future. This collapse in commodity prices suggests little concern for inflation accelerating despite the $85 billion per month of monetary easing by the U.S. Federal Reserve. The Producer Price Index fell 0.6 pct in March.

CBOT futures were supported by ideas that supplies of old-crop corn and soybeans are tight enough that higher prices are needed to ration supplies or to pull supplies from farmers. Wheat lead the rally on concerns recent freeze damage in the southern Plains was significant. The Funds were buying corn, beans and wheat. Corn also found support late this week by increased ethanol production in the latest period; ethanol prices have gained on gasoline too.

The next 2-week period looks to remain colder than normal throughout the eastern U.S. and to have above-normal rainfall in the eastern Corn Belt. Fieldwork and planting should be slowed. http://www.cpc.ncep.noaa.gov/products/predictions/814day/index.php

Live Cattle futures closed little changed as fed cattle cash prices didn’t rebound from the $1/cwt lower price that traded mid-week. Boxed beef slid lower again today. Choice down 0.63 at 189.52; Select up 0.15 at 184.14. April Feeder Cattle closed lower for the fourth straight day and is about $1.20 above the contract low traded in March; the $9/cwt rally has almost been erased.

Lean Hog futures also closed little changed. April LH expired today (at $82.20), so May is now the nearby contract. May bounced off key chart support in the $86.50 area (for the fourth time in six weeks). Traders anticipate improving cash hog prices, but today’s market was weaker. The Pork Cutout fell $1.24/cwt. The cold balance of April will not help grilling demand.

Corn May +7 658.5; Jly +8 641; Dec +6 550 Bean May +11 1413; Jly +11 1379; Nov +5 1232   Meal May +5 400; Oct +3 343   Oil -54 4923 Wheat May +17 715; Jly +16 719.5; Dec +15 739     KC Jly +13 759; MGE +14 799 Oats +5.5 373 Rice +5 1582

LC Apr +27 12585; Jun +10 12075; Oct -15 12510 FC Apr -130 13792; May -85 14092; Aug -102 14780 LH May -2 8737; Jly +35 8990; Oct -5 8095 Milk Apr -1 1758; May +11 1885   US$ -.15% Dow unch 14865 SP -5 1589 NAS -5 3295 Tran -21 6144     VIX -.18 12.06

WTI -279 9072 Brent -126 10301 Gas -2.6 280.5   NG +11 425 HO -3 287 Eth -2.6 242

Gold -84 1480 Slvr -181 2588

2-yr unch 0.23% 5-yr -.04 0.69% 10yr -.07 1.72% 30yr -.08 2.92%

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Tagged Post Topics Include: Economics, Market updates