Harold House with the Kansas City Trade Group reports that a private exporter sold more than 360-thousand tons of soft red wheat to China for the 2013-14 crop year. Click below to hear more on the markets from KMZU’s Mandy Young and Harold House from the Kansas City Trade Group.
The lean hog pit should open moderately lower, checked by further weakness in the wholesale pork trade and nervousness regarding post-holiday product demand. Conversely, cattle paper is likely to open on a mixed basis as traders slowly position before cash news.
Cattle: Cash: Steady Futures: Mixed Live Equiv. $136.04 + $0.34
We should be able to tell whether or not cattle buyers intend to complete procurement before or after the July 4th holiday. Look for opening bids around $117 in the South and $190 to $191 in the North. Given asking prices of $122 in the South and $195-$196 in the North, packers will be required to show a little more life between now and mid-afternoon if they really want to enjoy a long weekend. Live and feeder futures seem set to begin with mixed price action with traders apathetic and/or uncertain about cash potential. To be sure, floor volume will be quite thin with many would-be buyers and sellers already gone for the holiday.
Hogs: Cash: Steady Futures: 10-30 Higher Lean Equiv. $117.75 + $0.45
Cash hog trade is expected to open Wednesday morning with near steady bids. It sounds like virtually all plants will be back at work on Friday. The Saturday slaughter could be as large as 110,000 head. Lean futures are staged to open moderately lower, pressured by spillover feeling and further evidence of faltering pork demand.
Wheat contracts were posting solid gains through early Wednesday, though no officials to China were announced. Soybeans also rallied in low volume. Corn reportedly did see sales to China announced, though the reaction was somewhat muted. Outside commodities were mostly higher, led by a continued strong rally in crude oil on growing concerns over the situation in Europe.
The Dow Jones Industrial Average closed 42.55 points lower Tuesday at 14,932.41. The overnight session saw the Dow Jones futures trade 103-points lower, indicating U.S. stocks could see heavy selling interest Wednesday. The overnight crude oil market was $1.42 higher at $101.02 while Brent crude was $0.83 higher at $104.83. The August gold contract gained $2.10 to close at $1,245.50 while the U.S. dollar index is 0.119 lower at 83.425. Soybeans at the Dalian Exchange were higher while Malaysian palm oil contracts were also higher.