Schwieterman: Lack of corn export sales weighing on market

Corn                                               Estimated Fund Position
Trends
Short Term:Down                       Net Long Futures and Options: 168094
Long Term: Up                             Change: -6000
Overnight Trade: H -4 @7:30 AM

The March corn has fallen to a new low for the move and is slipping below the 40 and 50-day moving averages. The lack of export sales seems to be weighing on the market as much as anything and other than that, there really isn’t much fresh news. This morning’s non-farm payroll report was friendly with the unemployment rate falling to 7.7%, but so far the only markets to see any benefit from that are the stock market and the petroleum. Look for sideways to lower trade as we head into Tuesday supply and demand report.

Wheat                                              Estimated Fund Position
Trends
Short Term: Down                         Net Long Futures and Options: -22942
Long Term: Down                          Change: +1000
Overnight Trade: Chicago: H -3 KC: H-4 @7:30 AM

The wheat has been gradually creeping higher for the past couple of sessions, but like the corn, the lack of export sales is keeping speculators from aggressively buying. Without something to give the market a boost very soon, the March KW will likely head to the bottom of the trading range near the $8.85 area.

Soybeans                                           Estimated Fund Position
Trends
Short Term: Up                                 Net Long Futures and Options: 88150
Long Term: Down                            Change: +4000
Overnight Trade: F-1 @7:30 AM

The January soybeans reached $14.98 ¼ overnight, which is probably close enough to the $15.00 objective for now. The market has since backed off and since the market is overbought, there is probably a good chance for an outside day down today on the charts. Demand is still very, very good and until that changes breaks are for buying, but right now it looks like this market is ready for a correction.

Live Cattle
Trend
Short Term: Down
Long Term: Down
Opening Calls: 20-40 Lower

Live cattle futures closed higher with the exception of the December contract on Thursday, but they are giving those gains back in overnight trade. Cash trade is yet to develop, with bids and asking prices continuing to hold a $4-$5 spread. Cutout values fell sharply, increasing problems for poorly margined packers. We continue to see captive supplies as a problem for near term cash trade. This morning’s employment report was supportive, with 7.7% the lowest since December 2008. Higher equities could boost cattle sentiment.

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

Feeder cattle futures closed sharply higher on Thursday, with triple digit gains in most contract months. The combination of solid fat futures and the downward swoon of corn futures is providing new buying interest in the feeders. Numbers are expected to be tight into the first quarter of 2013, with foreign competition appearing to tighten as well. We look for dips in feeders to be well supported from this point forward.

1. Feeder cattle review: Choice beef prices keep rolling higher
2. Ag markets diverge just before the long holiday weekend
3. Armyworms eat fescue pastures, hayfields
4. Commentary: New rules un-COOL
5. Oil edges up on book squaring, but posts big weekly drop
6. Cattle theft and brands

1. Former Eastern Livestock CEO, CFO sentenced for federal crimes
2. Post-tornado composting a solution for disposal of dead livestock
3. TSCRA works with sale barns to catch Houston cattle thief
4. More beef cows in worst drought regions than a year ago
5. Michigan hay buyers should plan purchases early
6. NASA backs 3D food printer to feed growing population

1. Commentary: In praise of animal foods
2. What’s on America’s grill this weekend?
3. Meat industry associations quick to attack the new MCOOL rule
4. Seven jobs more dangerous than farming
5. NASA backs 3D food printer to feed growing population
6. Post-tornado composting a solution for disposal of dead livestock