Schwieterman: Cash index stabilizes, live cattle futures lower

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Corn                                             Estimated Fund Position
Trends
Short Term:Down                     Net Long Futures and Options: 169094
Long Term: Up                           Change: -5000
Overnight Trade: H unch @7:30 AM


The March corn continues to trade just above the 40 and 50-day moving averages. Fresh news is sparse. We will have a supply and demand report next week, but there is a very good chance that there will be no changes at all, which is typical for a December report. Plan on another day of consolidation with $7.47 acting as support and $7.57 as resistance.

Wheat                                         Estimated Fund Position
Trends
Short Term: Down                    Net Long Futures and Options: -25942
Long Term: Down                    Change: -2500
Overnight Trade: Chicago: H +3 KC: H+3 @7:30 AM


The March KW is making its way back to the bottom of the trading range. The wheat market isn’t getting any help from the corn and we still aren’t being overwhelmed with big export sales. However, the one bullish factor that remains is the dry weather in the HRW Belt. The crop isn’t improving and chances for moisture are slim. The new crop contracts will be very well supported for the time being.

Soybeans                                    Estimated Fund Position
Trends
Short Term: Up                          Net Long Futures and Options: 77150
Long Term: Down                     Change: +2000
Overnight Trade: F +8 @7:30 AM


The January soybeans made another new high for the move overnight and it still looks like the market is headed for the $15.00 level. The news remains the same. Demand is strong and there is always one eye on the weather in S. America. Soybeans and soybean oil have the best chances of seeing changes in the supply and demand report and if there are changes they will be in the form of higher demand. Buy breaks.

Live Cattle
Trend
Short Term: Down
Long Term: Up
Opening Calls: Mixed


Live cattle futures closed moderately lower on Tuesday, with December taking out its’ low from the previous day and closing below the 40 day moving average. We saw some light movement of cash in western Nebraska Tuesday evening at $122.50. Asking prices in most areas remains $127+, with bids in the $122-$123 area. Mondays slaughter was reduced to 120,000, while Tuesday picked up to a hardy 129,000. We are now 6,000 ahead of last weeks’ pace, suggesting that the packers feel comfortable with their numbers or they will need additional inventory from the cash market.

Feeder Cattle
Trends
Short Term: Down
Long Term: Down
Opening Call: 10-20 Higher

Feeder cattle futures closed narrowly mixed on Tuesday, unable to hold early gains, but not following fats deep into negative territory. The cash index stabilized for the day, which may provide underlying support. Overnight corn prices are mostly flat, as they await Stat Canada numbers this morning. The continued drought in the plains is pushing more cattle away from wheat pasture and into feedlots.



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