Schwieterman: Feeder cattle futures close with triple digits

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Corn Estimated Fund Position

Trends – December Contract

Short Term:Down Net Long Futures and Options: 10001

Long Term: Down Change: +1000

Overnight Trade: Z +5 @7:30 AM

Export sales were good with 291,500 MT of old crop and 1.4 MMT of new crop sales. Sales have now exceeded the export estimate for the year and now we just need to get it shipped out. There is a little bit of dry weather concern in the extended forecasts, which is generating some short covering. The December corn is going to test the open chart gap that was left Sunday night and it will take a close above $3.78 to really make the bears nervous.

Wheat Estimated Fund Position

Trends – December Contract

Short Term: Down Net Long Futures and Options: -71819

Long Term: Down Change: +1000

Overnight Trade: Chicago: Z +9 KC: Z +11 @7:30 AM

Wheat export sales were good at 443,200 MT. This isn’t enough to get speculators excited, but it is enough to avoid a cut in the export estimate. The wheat closed positive yesterday and holding on to today’s gains would start to make the bears anxious. What the bulls need to see is a close above $6.46 ¼ in the December KW today followed by a close above $6.70 in the near future.

Soybeans Estimated Fund Position

Trends – November Contract

Short Term: Down Net Long Futures and Options: -52341

Long Term: Down Change: +6000

Overnight Trade: X +28 @7:30 AM

Soybean export sales were great with 226,700 MT of old crop and 2.45 MMT of new crop sales. Lower prices have certainly found some demand. The drier extended forecasts are also helping the market move higher, but until the November beans close above $11.19, there probably isn’t anything to get excited about.

Live Cattle

Trend

Short Term: Up

Long Term: Up

Opening Calls: 100-200 Higher

Live cattle closed mixed on Wednesday, with the front two months modestly higher and deferred contracts as much as 1.37 lower. Overnight trade has continued to see active bull spreading, with 2.00 gains in the August and only .25 in the April. Cash asking prices are on the rise, with some northern feedlots pricing cattle $165+ this morning. August should remain well supported as long as packers continue to chase cattle. Cutout values were mixed with a higher bias, choice down .21 and select up 2.92 for the day.

Feeder Cattle

Trends

Short Term: Up

Long Term: Up

Opening Call: 50-100 Higher

Feeder cattle futures closed with triple digit gains out through the November contract. Cash index levels broke downward momentum settling .16 higher on Wednesday. Friday’s on feed report is expected to be supportive, with average placement estimates off % from year ago levels. Overnight activity is stronger across the board, with support from the fats outweighing 3-4 cent gains in the corn market. The two day rebound in the grains has some traders concerned over a near term bottom being formed in those markets.



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