Wednesday's Closing Grain and Livestock Futures
Jul. corn closed at $6.64 and 1/2, up 7 and 3/4 cents
Jul. soybeans closed at $15.34 and 1/4, up 9 cents
Jul. soybean meal closed at $463.30, up $4.50
Jul. soybean oil closed at 46.63, down 51 points
Jul. wheat closed at $6.67, down 8 and 3/4 cents
Jun. live cattle closed at $121.27, up 12 cents
Jul. lean hogs closed at $99.95, down 20 cents
Aug. crude oil closed at $95.50, up 18 cents
Jul. cotton closed at 83.68, down 141 points
Jul. Class III milk closed at $17.12, down 1 cent
Jun. gold closed at $1,229.60, down $45.20
Dow Jones Industrial Average: 14,910.14, up 149.83 points
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Market News and ReCap
Soybeans were mixed on old crop/new crop spread trade. The cash basis was firm Wednesday, supporting the July contract. At this point, traders are getting ready for the USDA numbers out on Friday, expecting at least some increase in acreage and a decrease in stocks. There’s more rain and flooding around some key growing areas, especially Illinois and Iowa, but longer term outlooks are better for development weather. Soybean meal was mostly firm on the solid demand outlook. Bean oil was down on follow through selling. USDA’s weekly export sales report is out Thursday at 8:30 AM Eastern/7:30 AM Central. Soybeans are pegged at 100,000 to 400,000 tons, meal is seen at 50,000 to 150,000 tons, and oil is placed at 0 to 10,000 tons.
Corn was mixed in pre-report position squaring. Similar to beans, the cash basis was firm Wednesday, supporting July. The trade is expecting a reduced acreage estimate Friday and there’s a lot of uncertainty tied to the stocks figure. Exports have been slow, but domestic demand has been solid. Ethanol was mostly lower with July up and the other months down. Argentina’s Ag Ministry will allow exports of 16 million tons of corn during the 2013/14 marketing year. Weekly U.S. export sales are expected to be between 200,000 and 500,000 tons.
The wheat complex was lower with Chicago and Kansas City leading the way down on harvest pressure. Hard red winter yields in parts of Kansas have come in better than expected and the soft red winter numbers have generally been good. Past that – the dollar was up, the global fundamentals remain bearish and the Black Sea region harvest is going well. European wheat was firm. Dow Jones Newswires reports that in an effort to limit rising costs of bread and flour, Argentina’s government is suspending wheat exports, effective through the end of the marketing year. South Korea’s Major Feedmill Group bought 120,000 tons of optional origin feed wheat. In sell-buy-sell trade, Japan issued a new tender for 120,000 tons of feed wheat. Weekly U.S. wheat sales are estimated at 300,000 to 600,000 tons.
Feedlot country was quiet on Wednesday afternoon with very little in the way of serious buying interest. There were a few bids on cattle on a live basis in the South at 117.00 and 190.00 to 191.00 dressed in the North. Asking prices are around 122.00 and 196.00 to 197.00. With the $5.00 separation between the asking pieces and bids significant trade will probably be delayed until Thursday or Friday. The kill totaled 123,000 head, 1,000 less than last week and 3,000 smaller than last year.
Boxed beef cutout values were lower on choice, firm on select on light to moderate demand and moderate offerings. Choice beef was down 1.06 at 196.51, and select was up .59 at 186.51.
Chicago Mercantile Exchange live cattle contracts settled 12 to 105 points higher following a lackluster opening. Though fundamental reading remains uninspiring some specs and commercials were impressed with how the board is trying to build on last week’s rally. Such action supports technical theories that a market bottom has been established according to DTN’s John Harrington. June settled .12 higher at 121.27, and August was up 1.05 at 122.17.
Feeder cattle ended the session 60 to 105 points higher as feeders followed the positive leadership in the live cattle pit. Yet some buying enthusiasm may have been checked by moderate strength in the corn market. August was up 1.05 at 148.92, and September was .95 higher at 151.02.
Feeder cattle receipts at the Sioux Falls Regional Stockyards at Worthing, South Dakota totaled 1521 head on Monday, Feeder steers and heifers trended steady to firm with last week’s much smaller supply. The demand was moderate for cattle in moderate flesh condition, with very good demand for one long string of cattle offered in lighter flesh condition. Feeder steers averaging 984 pounds traded at 124.46 per hundredweight. Fleshy heifers weighing 941 pounds brought 118.75.
Lean hogs settled unchanged to 20 points lower after trading mixed earlier in the session. There is concern by some traders that prices may have hit a seasonal peak early in the week and that probably led to additional selling interest. Cash prices will depend heavily on demand for pork following the 4th of July and how many hogs are available to processors in the weeks ahead. July settled .20 lower at 99.95 and August was down .05 at 97.65.
Barrows and gilts in the Iowa/Minnesota direct trade closed 1.01 lower at 99.84 on a carcass basis, the West was down .61 at 99.75, and the East was .08 higher at 97.59. Missouri direct base carcass meat price closed steady from 93.00 to 96.00. Butcher hogs at the terminals were steady to 2.00 higher from 65.00 to 72.00.
The pork carcass cutout value was up 1.45 at 111.33 FOB plant in the afternoon report.
The strong basis created by the premium cash hog index and discounted summer lean futures should work to promote aggressive country marketing and keep finishing floors very current.
Wednesday’s hog kill at 409,000 head is 7,000 more than last week and 10,000 greater than last year.
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