Market Closes - May 7, 2014

Posted on May 7, 2014
CBOT futures closed lower on little new information. Corn rallied 4-5 cents in final minutes, taking the December YC contract to a new high for the day and an unchanged closing price. Old-crop corn didn’t have the same buying interest. Soybean futures headed south mid-morning and never found enough buying to turn prices back up.  Old-crop lost ground again to new-crop. The JULY Soybean chart has a double-top at 15.21 and price is threatening the support area between 14.29 and 14.41.  A break below 14.29 could point toward 13.50-13.60.  The NOVEMBER Soybean price is sitting on the uptrend line off the January 2014 low.  Soybean futures appear to be at a pivotal point which Friday’s USDA WASDE Report could affect.

Wheat futures also had strong buying in the closing minutes to put the closes near the day’s highs. At noon EDT on Friday, USDA will release its Winter Wheat production estimate.  Reuters reports the average analyst prediction is 1.468 billion bushels, comprised of 782 million HRW, 467 million SRW and 219 million white wheat.

The 6-10 and 8-14 day outlooks call for below-normal temperatures in the eastern half of the U.S. and rainfall to favor below-normal levels from the western Corn Belt south through Texas.  However, the 5-day projection expects good rains in eastern KS/OK/TX – this still misses much of the HRW acres.

Cattle futures rallied early but tanked a couple hours later and spent the balance of day mostly sideways. Weaker boxed beef values and negative technical considerations weighed on the market.  Choice down 0.73 at 227.15; Select down 0.30 at 213.26/cwt.

Lean Hog futures closed lower with a big drop in the June LH contract. Yesterday’s 4 cent/lb drop in the pork cutout weighed on prices.  Pork closed near steady today. Today’s chart action looks like more downside risk exists unless the cash markets strengthen. The JUNE LH contract is at $7/cwt premium to the current CME LH INDEX.

On the positive side is USDA’s report that March Pork Exports were up 23 pct from a year ago. Export gains to Mexico and China/HK are credited for 2/3 of the gains, according to the Daily Livestock Report from CME Group.

Corn Jly -3 514; Dec unch 509 (504-10) Bean Jly -13 1446; Sep -9 1273; Nov -8 1217 (1215-26)  Meal Jly -3 475; Oct -2 389  Oil -28 4083 Wheat Jly -1 738 (727-40); Dec -1 760  KC -4 841; MGE +2 806 Oats -3 356 Rice -1 1554

LC Jun -72 13757; Oct -20 14205; Dec -42 14420 FC May -45 18302; Aug -57 19067; Oct -67 19152 LH May -82 11522; Jun -205 12117; Oct -30 10395 Milk May +5 2275; Jun +38 2147

US$ +.1% Dow +117 16519 SP +10 1878 NAS -13 4068 Tran +44 7700 VIX -.39 13.41

WTI +131 10081 Brent +103 10809 Gas +4 292 NG -5 475 HO +4 293 Eth +6.5 206

Gold -19 1290 Slvr -32 1932

2-yr -.024 0.403% 5-yr -.026 1.655% 10yr steady 2.593% 30yr +.024 3.405%

Blue Grass East Stockyards Cattle Auction Report for 05/07/2014 Cattle Receipts:  945   Last Week:  312   Year Ago:  624

Compared with last week steer calves under 600 lbs sold 2.00 to 5.00 higher with very good demand with some featherweights 10.00 to 20.00 higher in a limited comparison with last week’s light test.  Heifer calves under 600 lbs sold 3.00 to 10.00 higher with exceptionally good demand.  Calves over 600 lbs sold firm in a limited comparison with last week’s light test.  Market very active today.  Slaughter cows and slaughter bulls sold steady with very good demand.   

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Tagged Post Topics Include: Economics, Market updates