Market Closes - January 21, 2014

Posted on Jan 21, 2014
The week got off to a bad start for those owning soybeans.  Soybean and meal futures fell sharply on favorable weather(forecasts) in Argentina and rumors of Chinese cancellation of US soy purchases (replaced by South American shipments).  The large LONG position of the spec funds amplified the downside move.  Soybeans closed at/near the day’s lows. Need to monitor the uptrend line off the August low through the early January low. The weekly chart has support at $12.43.

Since funds are already large shorts in Corn and Wheat futures, the selling interest wasn’t present today.  Wheat returned to the key chart support area at contract lows.  Corn futures have established well-defined downtrend channels over the past 6 trading days. Soybean futures may determine the next step for corn and wheat.

Live Cattle futures closed strongly higher as boxed beef values jumped $5/cwt on Monday and kept going up today. Choice carcasses up 3.16 at 239.72; Select carcasses up 2.70 at 237.15/cwt.  Enjoy the beef “features” at the grocery now!  Note that the spec funds have been huge longs in Live Cattle futures for months; at these record prices, there’s always risk that a technical “sell” signal will cause a quick sell-off in futures.

Lean Hog futures closed mixed with relatively small changes.  The February LH contract was weighed by its premium to cash hog price which can’t seem to get a bid.  The Pork Cutout weakened some today as well.  LH futures indicate that hog and pork prices should begin to increase soon all the way into the summer months. Corn Mar +1 425 (421-26); Jly unch 438; Dec -2 447 Bean Mar -36 1280 (1280-1314);        Jly -32 1250; Nov -16 1109 Meal Mar -18 416 (416-32); Oct -8 346 Oil +36 3810 Wheat Mar -1 562; Jly -1 575 KC -2 621; MGE -4 614 Oats unch 399 Rice -15 1545

LC Feb +120 14155; Jun +85 13230; Oct +65 13315 FC Jan -20 16980; Apr +62 16927; Aug +20 17130 LH Feb -20 8597; Apr +47 9237; Jun +27 10185 Milk Jan unch 2094; Feb +40 2232

US$ unch

Dow -44 16414 SP +5 1844 NAS +28 4226 Tran +42 7470 VIX +.43 12.87

WTI +38 9497 Brent +53 10688 Gas unch 262 NG +13 446 HO -1 301 Eth unch 188

Gold -10 1242 Silvr -45 1985

2-yr +.005 0.39% 5-yr +.02  1.65% 10yr +.01  2.83% 30yr -.005 3.75%

The International Energy Agency said world crude oil consumption will climb by 1.3 million barrels a day, or 1.4 percent, to a record 92.5 million barrels a day. China will account for 28 pct of the increased demand, using 10.5 million barrels/day.   The increase of 90,000 barrels a day from last month’s report follows the first year of annual demand growth in developed nations since 2010, it said.

 Blue Grass Stockyards  Report for 01/21/2014     ****Special cow sale Wed. night at 6:30 p.m. Receipts:  832   Last Monday:  1,644   Year Ago:  835

Compared to Monday’s sale steer and heifer calves sold steady with good demand on an average to good quality offering.  Yearling steers sold steady with good demand.  Yearling heifers no test.  Slaughter cows sold steady in a light test.  Slaughter bulls too light to test.

Total supply included 02% slaughter cows, less than 01% slaughter bulls, less than 01% replacements and 97% feeders.  Feeder supply 61% steers, 18% bulls, 21% heifers with 59% of feeders weighing over 600 lbs.

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Tagged Post Topics Include: Economics, Market updates