Print this page

2013 Bi-Weekly Market Briefings

SOYBEANS

Soybeans continue to trade in the same pattern that started last fall. Old-crop May has generally moved in a range between $15 and $13.50, with a couple of session dipping slightly lower. Everyone assumed export sales would shift to South America, and with a big crop being harvested, that will be the case. However, logistical problems – moving from harvest point, to elevators, to shipping points – have been a nightmare. Pictures of 30- to 40-mile truck lines and hundreds of ships waiting to load are common. This has tempered downside pressure, and keeps the market trading sideways. New Crop is trading a little tighter, between $13.50 and $12.50, with the market lingering near the low side as planting projections rise. The average pre-report estimate is 78.4 million acres, up from 77.2 million acres last year. Stocks are projected around 930 million bushels. If either plantings or stocks are off the mark on Thursday, that will give the market direction.

CORN

Corn has been fairly firm recently, but remains range-bound like soybeans. Old-crop support starts around $6.80, with $7.50 offering long-term resistance. Stocks are expected to be near or slightly below 5 billion bushels, the smallest in 24 years. Planting estimates have ranged as high as 99 million acres, but the pre-report average has dropped to 97.33 million acres, just 170,000 acres above 2012. This provided oxygen to the December contract that, just three weeks ago, dipped well below established support at $5.50 and appeared ready to decline further. The market reversed and rallied above $5.70 and could push toward $5.90 if planting intentions fall below the above-mentioned acreage.

WHEAT

Wheat is showing renewed strength after July futures sunk to $6.86 in the first week of March. The rally has stalled around $7.30 the last several days and needs to close above resistance at $7.52 to indicate a change in trend direction. The market needs fresh demand news to give it a boost. Crop conditions are “less than good,” with Kansas reporting 31 percent of the crop “poor to very poor” and just 29 percent “good to excellent.” Some areas of the plains will need more moisture to finish the crop.

COTTON

Cotton futures have given back a good portion of the 12-cent old-crop gain that started on Feb. 28. Strong yarn demand spurred the upturn, which was throttled by reports that China and India would release state-owned stocks. May futures fell 8 cents in a week, finally finding support around 86 cents. That is near the top of a breakaway chart gap that extended the initial upturn. New-crop December was unable to move through resistance just above 89 cents. That may have been because of the perception that acreage for 2013 had been pulled away from corn and beans. The pre-report survey averaged just more than 10 million acres, but ranged from 9 to 11 million acres. The National Cotton Council survey that was released in early February showed just more than 9 million acres. The mid-south was projected to drop plantings by more than 50 percent, to just more than 1 million acres. Have plans changed that much?

RICE

Rice futures continue a week-long rally that follows a five-week decline of $2.17. May futures peaked at $16.67 on Feb. 8 and bottomed at $14.50 on March 15. That doesn’t reflect a market that has shown strong domestic demand and good milled- and rough-rice export demand. Investment funds appear to have moved from commodities to other areas, while huge intervention stocks in Thailand hover over the world market. With U.S. long-grain stocks tightening, the soon-to-be-answered question is how this will impact 2013 plantings.

CATTLE

April live cattle futures have begun to consolidate above the recently charted contract low of $124.65. The market needs to close above resistance at $127 to build any upward momentum. Feeders are attempting to consolidate as well, with April support at the contract low of $136.80. Product prices continue to weaken and, as a result, packer demand is being described as “cautious.”

HOGS

Technically, Hog futures are looking a whole lot better than they did about a week ago. June has climbed to its highest level since early March. The market needs to move above resistance at $92, though, to indicate another leg up. Pork values have improved and should continue to as demand increases through Easter and beyond. The holiday-shortened week will help with that, as it means there will be less pork available.

POULTRY

In poultry, commercial hatcheries in the 19-state weekly program set 200 million broiler-type eggs in incubators during the week ending March 16. This was up 1 percent from the number set the corresponding week a year earlier. Average hatchability for chicks hatched during the week was 84 percent. Broiler growers in the 19-state weekly program placed 165 million chicks for meat production during the week ending March 16, also up 1 percent from the comparable week a year earlier. Cumulative placements for the year are at 1.8 billion, up 1 percent from the same period a year earlier.

Back to 2013 Bi-Weekly Market Briefings
Back to Bi-Weekly Market Briefings Index