Tuesday's Closing Grain and Livestock Futures
Jul. corn closed at $7.04, up 12 and 1/4 cents
Jul. soybeans closed at $16.13 and 1/4, up 4 cents
Jul. soybean meal closed at $520.80, up $9.70
Jul. soybean oil closed at 47.08, up 8 points
Jul. wheat closed at $6.75 and 1/2, up 15 and 1/2 cents
Aug. live cattle closed at $122.72, up 65 cents
Jul. lean hogs closed at $100.85, down 27 cents
Aug. crude oil closed at $103.53, up 39 cents
Oct. cotton closed at 86.68, up 31 points
Jul. Class III milk closed at $17.30, up 3 cents
Jul. gold closed at $1,245.90, up $11.00
Dow Jones Industrial Average: 15,300.34, up 75.65 points
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Market News and ReCap
Soybeans were higher on commercial and speculative buying. Crop development is slow, with 10% of beans blooming, compared to the five year average of 24%, the near term supply is tight and demand looks good. In any event, the trade’s getting ready for Thursday’s USDA supply and demand update out at Noon Eastern/11 AM Central. Past that – the focus remains on that slow development pace and the export market. Soybean meal and oil were higher, following beans. Meal outgained oil on strong domestic demand.
Corn was higher on speculative and commercial buying. Corn’s also looking at good near term fundamentals and a slower than average development pace, with only 6% of the crop silking, compared to 20% on average. There’s more rain in the forecast around the Eastern Cornbelt, while Western areas are seen as mostly hot and dry. Ethanol futures were higher. Taiwan bought 60,000 tons of corn from Brazil, with 55,000 tons at a premium to the December CBOT futures price.
The wheat complex was higher on commercial and speculative buying. The winter wheat harvest is behind average with more delays expected in wet portions of the soft red winter region. Spring wheat’s in very good shape, but developing slower than average with USDA’s wheat production guess also out Thursday. November European wheat was sharply higher. DTN reports Pakistan has purchased “about” 250,000 tons of Black sea origin wheat over the previous two weeks. Algeria is tendering for 50,000 tons of optional origin milling wheat and Japan is tendering for 49,954 tons of milling wheat (23,963 tons U.S. white club, 22,784 tons Canadian western red spring, 1,710 tons U.S. soft red winter, and 1,497 tons of Australian premium white).
Cattle country was at a standstill on Tuesday afternoon with bids and asking prices poorly defined. Private sources reported a few starter bids in Kansas at 115.00 to 116.00. A few of the showlists have been priced around 122.00 in the South and 196.00 to 197.00 in the North. Significant trade volume could be delayed until Thursday or Friday. The kill totaled 124,000 head, 2,000 below last week and 5,000 less than last year.
Boxed beef cutout values were weak on the choice, firm on select on light to moderate demand and offerings. Choice boxed beef was down .53 at 194.32, and select was .72 higher at 185.85.
Chicago Mercantile Exchange live cattle contracts settled 17 to 70 points higher on Tuesday. Futures bounced higher and lower throughout the session. The market suffered from lack of direction for much of the session but focused on renewed support in the corn market while support failed to develop in the boxed beef market. August settled .65 higher at 122.72, and October was up .52 at 126.70.
Feeder cattle ended the session 27 to 60 points lower. Moderate to sharp pressure held through the session based on the strong rally in the grain market. August settled .45 lower at 151.15, and September was down .47 at 153.67.
Feeder cattle receipts at the Oklahoma National Stockyards totaled 7,000 head. Compared to last week, feeder steers sold 3.00 to 6.00 higher with the exception of cattle over 500 pounds trading as much as 10.00 higher. Feeder heifers are steady to 2.00 higher on a limited test and calves sold firm in a light test. Demand was very good. Feeder steers medium and large 1 averaging 880 pounds traded at 142.50 per hundredweight. 725 pound heifers brought 139.54.
Lean hogs ended the session mixed with only the front months showing losses. The deferred contracts managed to close in the black. There continues to be a lot of uncertainty in the market about the future direction of cash markets and if additional pressure is expected through the month of July. This could keep many traders on the sidelines until more defined fundamental news develops. July settled .27 lower at 100.85, and August was down .37 at 95.17.
There was slow market activity with light demand in the hogs on Tuesday. Barrows and gilts in the Iowa/Minnesota direct trade closed .30 higher at 99.97 on a carcass basis, the West was up .55 at 99.58, and the East closed .59 lower at 98.15. The Missouri direct base carcass meat price was steady to 1.00 lower from 93.00 to 96.00. Terminal hogs were steady to 1.00 to 2.00 lower from 65.00 to 70.00 live.
The pork carcass cutout value was 1.48 lower at 104.96 FOB plant on a negotiated basis.
Pork processors continue to enjoy excellent margins, a reality that should support aggressive chain speed and lend reasonable support to spot cash sales.
The Tuesday hog slaughter was estimated at 400,000 head, 24,000 less than last week, but 8,000 more than last year.
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