Market Update - December 18, 2014

Posted on Dec 18, 2014
CBOT futures are up slightly with wheat once again performing best. The day’s highs came overnight when crude oil was also moving up sharply. However, energy futures have reversed and are posting losses. This seems to have weighed on CBOT futures as well. Weekly export sales were mostly in line with expectations. USDA said that China has approved import of Syngenta’s Viptera corn; this had been expected for a few days.

Cattle futures are trading mixed with the Feeder Cattle finally back to trading. The nearby January FC contract opened limit down $4.50 (new limit-see below), then rallied nearly $6.50 in 45 minutes before fading again to $4.00 losses, and now only $1.70 loss. How about that volatility !!! Choice beef is up .11 to 242.52 and Select is down .57 to 230.56/cwt.

CATTLE CME Group took emergency action to expand the Feeder Cattle daily price limit from $3.00 to $4.50/cwt. CME also said a limit move in the first two contract months will cause the limit to increase by 50% the next day. In other action, the CME also raised initial and maintenance margins by 50 percent. This comes after 5 days of limit-down losses, so maybe this marks the end of the crash in Feeder Cattle futures.

Lean Hog futures are moderately higher as the weight of the cattle market comes off its back. However, the cash hog and pork markets aren’t that supportive. FOB Plant Pork down .62 to 86.62 as belly values drop 5 percent. (see PEDv story below)

Corn Mar +3 411 (407-14); Jly +3 426; Dec +3 435 Bean Jan +3 1030 (1024-37); Jly +6 1052; Nov +6 1015 Meal +4 364 Oil -5 3172 Wheat Mar +8 656; Jly +4 650 (643-66) KC +5 686; MGE +4 664 Oats +2 317 Rice -2 1209

LC Dec +152 15795 (15597-15860); Feb +155 15737; Jun +152 14970 FC Jan -170 21490 (low 21210); Mar -55 21170; Aug +162 21385 LH Feb +115 8162; Apr +122 8312; Jun +155 9045 Milk Jan +30 1605; Feb +31 1559

US$ +.2%

Dow +1.5% SP +1.4% NAS +1.5% Tran +.8% VIX -9.4% 17.61

WTI -1.5% Brent -1.6% Gas -1.2% NG -.6% HO -2% Eth +.8% Gold steady Slvr steady

5-yr +.046 1.664% 10yr +.059 2.209% 30yr +.063 2.814%

HOGS A large PEDv outbreak is occurring in the Ukraine. The USDA FAS report predicts PEDv could spread in Europe and ultimately kill 25-35 million pigs over the next 18 months. This compares to the North American PEDv losses estimated around 5 million head. This has potential to have a significant market impact especially in global trade.

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Tagged Post Topics Include: Economics, Market updates