Schwieterman: Low placements to help feeder cattle futures

 Resize text         Printer-friendly version of this article Printer-friendly version of this article

Corn                                         Estimated Fund Position
Trends
Short Term: Up                      Net Long Futures and Options: 103385
Long Term: Up                       Change: -7000
Overnight Trade: K -2 Z +1 @7:30 AM


The corn market is in corrective mode. $7.20 held the May contract on Friday and a move back to at least that level today is likely. Failure at $7.20 would make $7.15 and $7.08 the next downside objectives. While some corrective action is very likely today and tomorrow, heavy selling pressure is unlikely ahead of Thursday’s reports since there is a very strong likelihood of a bullish stocks number.

Wheat                                       Estimated Fund Position
Trends
Short Term: Up                       Net Long Futures and Options: -54151
Long Term: Down                   Change: +1000
Overnight Trade: Chicago: K Unch KC: K Unch @7:30 AM


The wheat has been very quiet, but weaker, in overnight trade. With no strength in the corn and expectations for crop condition ratings to improve, it is very difficult for the wheat to move higher. The stocks report could provide a boost to the market if it indicates greater than expected feed usage, but for the most part speculators are interested in crop size and export sales. Plan on sideways/lower trade today.

Soybeans                                   Estimated Fund Position
Trends
Short Term: Down                   Net Long Futures and Options: 85172
Long Term:Up                           Change: -4000
Overnight Trade: K -5 @7:30 AM


The soybean market has failed to capitalize on Thursday’s strong move higher. Eventually this market is move back to the top of the trading range, but so far this week we don’t have any sign of strength. This market will react favorably to any indication of fresh export news since we really can’t handle many more sales. Breaks are a buying opportunity.

Live Cattle
Trend
Short Term: Down
Long Term: Down
Opening Calls: 40-75 Higher


Live cattle futures closed moderately lower on Friday but are expecting to recover those losses on the open this morning. Placement numbers fell well below estimates for the month of February, with only 86% of last years’ total being placed into feedlots. The numbers suggest that supplies of fed cattle should remain tight through the summer time frame. The 93% marketing figure could limit the buying in the front two months, while August and October benefit from the placement totals. Higher equities should provide additional support.

Feeder Cattle
Trends
Short Term: Down
Long Term: Down
Opening Call: 20-50 Higher


Feeder cattle futures closed lower on Friday but should benefit from the placement figure to start the week on a better note. April futures lost a little over a dollar for the week and the cash index has fallen to 135.06 heading into the weekend. The March feeders will expire on Thursday, with April about a 3.00 premium to the Index. Old crop corn prices are 3 cents lower in early morning trade, which may provide additional support to the feeders. Oklahoma City cash market will be monitored closely throughout the day for near term direction.



Comments (0) Leave a comment 

Name
e-Mail (required)
Location

Comment:

characters left


HPX 4x4 Diesel

Not only is the Gator HPX 4x4 the fastest choice in the John Deere Work Utility Vehicle line-up (with a top ... Read More

View all Products in this segment

View All Buyers Guides

Feedback Form
Leads to Insight