In the Market As of July 17, 2013
million larger than last year’s crop. September futures have support at the recent low of $6.52. Resistance begins at last week’s high of $6.93.
CORN futures have been on a SOYBEANS have seen strength bit of a roller coaster ride in recent weeks. A larger-than-expected this week. An unexpected drop in acreage report sent the market into the crop conditions ratings was a big plus for prices. However, USDA a near free-fall. December found still says that 65 percent of the crop support at $4.90, though, and prices have recovered a bit. The is currently in good to excellent weekly crop condition report from condition, 27 percent is fair, and USDA lowered the percent of the only 8 percent of the crop is in crop rated good to excellent by two poor to very poor condition, so percent, and that gave the market the crop is still faring well. Strong another bump. The condition domestic and export demand are of the crop was lowered as drier providing support. Meal futures weather enters the western parts of have moved to new contract high the Midwest. Continue to expect levels with August trading to volatility as we move forward in $15.30 amid tight supplies and the year. This year continues to good demand. Expected imports trail previous years, with only in the coming days will limit the 16 percent of the crop silking. upside, though. November has The next two to three weeks are failed at resistance at $12.94 ½ in vital to this year’s crop. Hotter the recent rally. Further resistance temperatures and dryer weather is at $13.19 and $13.33, but without major weather problems, it will reduce the plants’ ability to is unlikely futures will retest those pollinate. levels. In fact, USDA still estimates COTTON prices remain locked the average on farm price for in the same sideways pattern that soybeans to be between $9.75 and has held the market for the past $11.75, so this rally could be seen four months. December charted as a pricing opportunity. a bearish key reversal on Monday in reaction to rain in the very dry WHEAT futures are finding West Texas production area. There some support from outside has been little follow-through markets despite harvest pressure. so far, as the market has found Export competition from cheap support at Monday’s low of 83.91 Black Sea wheat is also limiting the upside potential. USDA’s wheat outlook report released this week provided additional information into the class breakout of the recent supply/demand report. The soft red winter wheat crop is now forecast at 539 million bushels, a 30-million bushel increase from the June estimate and 119
cents for the time being. Key support remains the June low of 81.72 cents. In RICE futures, the bleeding has stopped for the time being. September took about $1.70 off the market between mid-June and mid-July. While the USDA report reduced production 10 million cwt, milder temperatures as we move into pollination will help yields despite the later crop. USDA said this week that 69 percent of the crop nationwide is in good to excellent condition, 26 percent is fair, and five percent is poor to very poor. September has support at $14.73 and then $14.60. Upside retracement objectives are $15.40 and $15.60. Cattle futures are trading in a mostly sideways pattern. Strong packer margins, estimated to be $40.40 per head this week, are providing some support. However, reduced demand during the “dog days” of summer could cut into margins a bit. October live futures have support at $125.40 and resistance just below $127. Hog futures are receiving support from improving packer margins. August continued to recover after Friday’s move to $94.40 and is currently working to establish support at $95.
Contact • Brandy Carroll 501-228-1268, brandy.carroll@arfb.com • Matt King 501-228-1297, matt.king@arfb.com • Bruce Tencleve 501-228-1856, bruce.tencleve@arfb.com