CMEGroup Grain Futures Calls:
-July corn called mixed.
-July soybeans called mixed.
-July wheat called mixed.
June US dollar is up 14 at 85.11. June crude is down $.63 at $75.02. June Dow futures are up 17.
-Weekly unemployment benefit claims, released at 730 am, are expected to show a 4,000 decline to 440,000. This would mark four straight weeks of losses. Economists suggest they need to be under 425,000 to say there is job growth.
-Citigroup says China’s efforts to cool its property values could bring prices down by as much as 25%. The bank suggests this should not impact mortgages or loans to developers in the same way as the US.
-Crude oil stockpiles at Cushing Oklahoma are at a record 37 million barrels. Capacity is just over 53 million.
-World traders are watching how the UK’s new prime minister plans to reduce the government’s debt to GDP ratio. Currently, government debt is 11% of the nation’s output. Some economists in the UK suggests a rise in the sales tax, currently at 17.5%, along with a cut in public spending will be the first steps.
-Good rains will finish up today. Some northern areas will see up to 2 inches. Yesterday, the forecast called for clear skies from Friday through mid next week. Today’s forecast has put in a Sunday/Monday rain for the northwest cornbelt. From Tuesday through the weekend all areas will be dry.
Grain Market Influences:
Weekly grain export sales are viewed as bullish wheat, neutral to corn, soymeal, and soyoil, and bearish soybeans.
Corn summary… Yesterday we mentioned that the USDA numbers would need additional support to break the 400 level in December. Early this morning, with help from China buying 6 cargos (12 million bushels), the trade was starting to think we had the ammunition to take out the strong resistance.
The US Grains Council suggests it has heard China may have purchased up to 15 cargoes of US corn. That would imply they purchased seven more than currently known.
Agricultural officials in China told Reuters newswire corn planting is now ongoing in the key northeast provinces.
Soybean summary… China’s corn purchase today set the stage for a big up day. Futures started with a 10 cent gain out of the gate but fund selling 3000 contracts was enough to reverse direction for a slightly lower close.
Wheat summary… Fundamentals remain long term bearish when we analyze just the domestic and world wheat data. Seasonals suggest a move to 523 vs the July and maintains strength not only on ideas the winter wheat crop is developing and spring wheat planting is taking place but also because wheat as a starch is attached to corn.
Japan purchased 142,000 tonnes of wheat. 80,000 of that will be sourced by the US.
Strategie Grains cut its estimate of EU soft wheat production by 1.2 million tonnes to 133.
India will allow 400,000 tonnes of wheat to be exported to Bangladesh. This ends its three year ban on exports.
-Wholesale beef closes down $.35 for choice and up $.04 for select.
-Pork carcass cutout closes up $.59.
-Cash hogs are called steady.
June Lean Hogs are called steady to 10 higher.
----Chart support 84.00 and resistance 87.80.
June Live Cattle futures are called 10 to 20 higher.
----Chart support 94.500 and resistance 96.50.
May Feeder Cattle futures are called 5 to 15 higher.
----Chart support 111.35 and resistance 115.00.
Livestock Market Influences:
Lean hogs summary… We now have three days of higher cash pork prices. This may help some of the trade’s concern over cash hog pricing. Though yesterday’s final Iowa/Minnesota cash hog report showed a big increase in pricing over the previous day, it did set back today.
Live cattle summary… Cash cattle have hit a theoretical wall. Active cash trade today at $100 in Oklahoma and Texas has now cleaned out the majority of showlists. This is a disappointment as the rise in beef prices since the last cash cattle trading would imply a $102 could be seen.
CMEGroup Grain Futures Calls: