Market Closes - March 5, 2014

Posted on Mar 5, 2014
CBOT futures sold off in the morning due to a calmer situation in the Ukraine (grain is reportedly being loaded on ships) and by USDA reporting a 9 million bushel soybean export sale cancellation for China.  However, soybean futures recovered later in the day with all three major grains closing little changed. Several private production and supply-demand estimates are being released in advance of USDA making its report on Monday.

Without any apparent bearish fundamentals, CME cattle futures headed south as soon as the pits opened.  Since this happened after moving to new highs, the resulting chart action, a bearish key reversal, is very negative.  This should limit upside potential in the short run and may encourage additional technical selling.  Stronger beef prices this afternoon are supportive.  Choice Beef rallied 2.75 to 234.51 and Select was up 2.19 to 231.93/cwt.

April Lean Hog futures followed a similar pattern as the cattle futures. Although April LH was down 95 cents at the pit close, the contract continued to rally in electronic trade to get back to unchanged at 4:00 pm.  Higher pork values quoted late-day may have encouraged the buying.  The FOB Plant Pork cutout finished the day up 1.51 to 109.05/cwt.  Note that the June and July LH contracts closed up $2.00 due to ideas that hog supplies will be cut sharply due to heavy incidence of PEDv in the current farrowing period.

Today’s economic reports and private jobs estimate were negative. The Federal Reserve confirmed that extreme winter weather affected all aspects of the US economy this winter.  The question is whether how much of this “lost business activity” will be recovered as temperatures warm.

Corn May -2 482; Jly -2 486; Dec -3 483 Bean May -2 1420; Jly -1 1395; Nov -1 1180 Meal May unch 450;  Oct +1 364 Oil -31 4340 Wheat May -1 642; Jly -1 646 KC +1 710;  MGE +3 689 Oats -20 limit  473 Rice -19 1524

LC Apr -195 14367 (14305-14665);     Jun -122 13577;  Oct -70 13702 FC Mar -67 17222 (17090-17400); Apr -35 17400;  Aug -42 17642 LH Apr -95 11072; Jun +200 11775; Oct -22 9597 Milk Mar +13 2223; Apr +36 2062

US$ -.1%

Dow -36 16360 SP unch 1874 NAS +6 4358 Tran +24 7490 VIX -.21 13.89

WTI -235 10098 Brent -150 10780 Gas -5 294 NG -11 456 HO -6 298 Eth unch 228

Gold +2 1340 Slvr -1 2118

2-yr unch 0.34% 5-yr unch 1.54% 10yr -.01 2.69% 30yr -.01 3.64%

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Tagged Post Topics Include: Economics, Market updates