Wednesday's Closing Futures Prices.
Dec. corn closed at $4.39, unchanged
Nov. soybeans closed at $12.73 and 3/4, up 5 and 3/4 cents
Oct. soybean meal closed at $417.60, up $9.10
Oct. soybean oil closed at 39.12, down 89 points
Dec. wheat closed at $6.86, up 4 and 3/4 cents
Oct. live cattle closed at $127.30, up 5 cents
Oct. lean hogs closed at $90.95, up 2 cents
Nov. crude oil closed at $104.10, up $2.06
Dec. cotton closed at 86.87, up 27 points
Oct. Class III milk closed at $18.09, down 4 cents
Oct. gold closed at $1,320.60, up $34.60
Dow Jones Industrial Average: 15,133.14, down 58.56 points
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Market News and ReCap
Soybeans were higher on technical buying and short covering. Contracts were a little oversold and due for a bounce after the recent losses, but nothing’s really changed. The trade’s watching harvest activity with some rain in the forecast and keeping an eye on South America, where forecasted rain will help planting. Soybean meal was up and oil was down on each product’s demand outlook. South Korean feedmills bought a combined 99,000 tons of combined U.S., South American, and Indian soybean meal (55,000 tons from South America, 24,000 tons from the U.S., and 20,000 tons from India).
Corn was steady to fractionally higher in consolidation trade. Corn’s also watching U.S. harvest activity and generally good anecdotal yields. With the current government shutdown, there’s a lot of uncertainty about if we’ll get the October 11 crop report on time, much less the weekly export sales or crop progress numbers. Ethanol futures were lower. A group of South Korean feedmills bought 11,000 tons of U.S. DDGS, while Nonghyup Feed Inc. purchased 52,000 tons of Black Sea origin corn after earlier cancelling a tender for 140,000 tons of optional origin.
The wheat complex was higher on commercial buying, short covering, and the lower dollar. Rain in Ukraine and Russia continues to delay planting and there are also concerns about damage in Argentina from a recent freeze. The trade’s also watching reports of low protein levels coming out of Canada. Tunisia bought 75,000 tons of optional origin milling wheat set to ship from Western Europe. In sell-buy-sell trade, Japan picked up 55,600 tons of feed wheat, while tendering for another 180,000 tons of feed wheat and 200,000 tons of feed barley.
The feedlot market was not established on Wednesday afternoon, with just a few bids at 123.00 in Kansas reported by private sources. It is difficult to identify specific bids, with buyers seeming ready to wait until Thursday or Friday before seriously engaging in procurement needs. Asking prices are around 128.00 plus in the South and 203.00 plus in the North.
Beef cutout information remains unavailable due to the government shutdown but several sources suggest carcass value has a firm undertone at midweek with poorly margined packers working to force cutouts higher. Private estimates suggest the kill will be somewhere between 122,000 to 124,000 head.
Live cattle contracts on the Chicago Mercantile Exchange settled higher in a range of 5 to 70 points with only the December contract in the red. Trade interest in live cattle futures was nearly muted on Wednesday with commercial and noncommercial traders alike being even more cautious due to the lack of information that normally is sought for direction. With no USDA data available concerning cash or meat values, most traders chose to remain absent through the early part of the week. There are questions as to how front month contracts will settle once they expire if federal shutdowns continue long term. This is likely to create some liquidation in October futures according to DTN analysts. October cattle settled .05 higher at 127.30, but December was .07 lower at 131.82.
Feeder cattle ended the session 15 to 55 points higher. The extremely light trade across the feeder cattle market helped to draw moderate to strong buyer support on Wednesday. Prices for 2014 contract months exhibited the most significant support as traders looked for increased direction from live cattle markets as well as corn futures. October settled .17 higher at 164.57 and November was up .15 at 166.20.
Feeder cattle receipts at the Ozarks Regional Stockyards. At West Plains, Missouri receipts totaled 2500 head on Tuesday. Compared to last week, steers sold steady except the 400 to 500 pounders which sold from 10.00 to 20.00 higher and heifers were 5.00 to 6.00 higher. The supply was light and the demand was very good especially for 400 to 500 pound black hided steers. Feeder steers, medium and large 1 weighing 500 to 600 pounds brought 158.00 to 192.00, 7 to 8 weights from 149.00 to 158.00. 5 to 6 weight heifers traded at 144.00 to 175.00 and 700 to 800 pound heifers from 128.00 to 144.00.
Lean hogs settled unchanged to 67 points higher. Moderate buying support developed early in the session across the nearby lean hog futures. Traders focused on short covering following the aggressive pressure seen over the last couple of trading sessions. Without additional cash or meat market information it is hard to assess just how overall supply levels are stacking up compared to the expected tight supplies seen in the quarterly report. October settled .02 higher at 90.95 and December was up .27 at 86.17.
Direct trade hogs are not reported due to the government shutdown. Barrows and gilts at Peoria closed steady to 1.00 lower from 61.00 to 63.00 live, Red Oak, Iowa was 1.00 lower at 61.00, and Zumbrota Minnesota is steady at 60.00. Missouri direct base carcass meat price closed steady to 1.00 lower from 85.00 to 88.00.
Allendale is reporting Smithfield says they will determine the price they pay for cash hogs based on the USDA market hog prices from September 30th for each day until the government returns through October 4th. After October 4th they will evaluate market conditions and determine a fair value.
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