Schwieterman: Cattle futures start the week with a move higher

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Corn                                  Estimated Fund Position
Trends – March Contract
Short Term: Up                 Net Long Futures and Options: -176958
Long Term: Down              Change: +5000
Overnight Trade: H -2 @7:30 AM


Yesterday the March corn stalled out at last week’s high and today we will see if the supply and demand report holds enough friendly information to help the market get through the resistance. The Dollar Index has made a new low for the move, which should be helpful today, but traders will want to see a cut in ending stocks before placing any buy orders.

Wheat                                 Estimated Fund Position
Trends – March Contract
Short Term: Down               Net Long Futures and Options: -107005
Long Term: Down                Change: -1000
Overnight Trade: Chicago: H -3 KC: H -4 @7:30 AM


The March KW fell to a new low for the move overnight, so there is still nothing positive report about the wheat charts. Today’s report should be friendly, but that is obviously irrelevant. The best hope for the wheat right now is to see friendly numbers from the corn and wheat and a weak Dollar through the day. If all those things happen the market might manage a positive close.

Soybeans                             Estimated Fund Position
Trends – January Contract
Short Term: Up                     Net Long Futures and Options: 121667
Long Term:Up                        Change: +8000
Overnight Trade: F +2 @7:30 AM


The January soybeans made a new high for the move overnight. There has been concern about the size of the S. American crop and about Chinese cancellations, but yesterday’s sales announcement to China proved that they are still in the market, which has traders trying to figure out how much USDA is underestimating the export estimate. Stocks could be very tight this summer and getting coverage now could be much safer than waiting to see what it costs to buy what is left in 6 months.

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


Live cattle futures closed moderately higher on Monday, with short covering a significant feature. Overall show lists were smaller for the week, with the Kansas list the main contributor. Our list was off 16% from the previous week, with only 2% of last week’s list carried over. It was our 4th smallest list ever. Overnight activity has trended steady to slightly lower, following modest equity losses and ahead of this mornings’ grain report.

Feeder Cattle
Trends
Short Term: Up
Long Term: Down
Opening Call: Mixed


Feeder cattle futures posted solid gains on Monday, with .67-.90 advances across the board. The rally came in the face of modest gains in the corn market and ahead of today’s 11:00 am USDA supply demand report. Cash index levels closed modestly lower and remains in relatively sideways pattern over the last 2 months. Overnight trade is mixed, with current prices up .10 to down .15.



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