The FOMC announced that effective January 2014 it is tapering its bond buying program of $85 billion by $10 billion – half in long-term Treasuries and half in mortgage-backed securities. The Dow and the SP500 soared back to chart resistance at the record highs set November 29. Tomorrow’s trade will be interesting to see if investors are bullish enough to move even higher.

Medium-term interest rates rose today on the taper news.  Higher rates tend to strengthen the US dollar’s value.  A stronger dollar is negative for US commodity exports and prices.

CBOT futures closed lower led by soybeans and soybean meal – yesterday’s winners. The losses grew larger as the trading day progressed with markets closing at/near the day’s lows.  Fundamentals don’t appear to have changed but rather a technical failure to rally through chart resistance encouraged profit-taking by the huge funds that are long soybean futures.  Of course, wheat futures continue to fall on a very bearish chart pattern that favors those funds short wheat futures.

Cattle futures closed moderately lower on Tuesday’s sharp drop in boxed beef values and expectations that the cash cattle market will trade below last Friday’s price. Today, boxed beef slipped more with Choice down 0.25 at 198.18 and Select down 0.40 at 188.38/cwt.  A strengthening US dollar could weigh on beef exports.

Lean Hog future closed higher, thus ending a 3-day run of lower hog futures.  Reports of higher cash hog prices lifted the market.  By day’s end, the FOB Plant pork cutout had jumped 1.98 to $89.05/cwt.

Corn Mar -2 425; Jly -1 441; Dec unch 454 Bean Jan -22 1324; Jly -16 1287;  Nov -5 1160 Meal Jan -7 441; Jly -6 410 Oil -25 3906 Wheat Mar -7 613; Jly -5 622 KC -7 654; MGE -3 647 Oats unch 354 Rice -22 1526

LC Dec -80 13095; Apr -60 13345; Jun -52 12805 FC Jan -110 16605; Apr -45 16662; Aug -32 16830 LH Feb +70 8635; Apr +75 9117; Jun +102 9992 Milk Dec unch 1901; Jan +10 1922

US$ +.5%

Dow +293 16168 SP +30 1811 NAS +46 4070 Tran +88 7207 VIX -2.41 13.80  -15%

WTI +38 9760 Brent +87 10931 Gas +5 269 NG -1 427 HO +4 300 Eth +1 182

Gold -12 1219 Slvr -10 1969

2-yr steady 0.35% 5-yr +.05 1.55% 10yr +.05 2.90% 30yr +.04 3.91% 

Blue Grass Stockyards Cattle Report for 12/17/2013

Receipts:  1,877   Last Tuesday:  1,070   Year Ago:  548 **Replacement cow sale Wed. night 12/18/13 at 6:30

Compared to Monday steer and heifer calves sold steady with very good demand. Yearling steers and heifers sold steady with good demand.  Quality was average to attractive.  Slaughter cows sold steady to 1.00 higher with good demand. Slaughter bulls sold steady to 1.00 higher with good demand.

Total supply included 06% slaughter cows, 02% slaughter bulls, less than 01% replacements and 92% feeders.  Feeder supply 49% steers, 12% bulls, 39% heifers with 48% of feeders weighing over 600 lbs. 

KENTUCKY CASH GRAIN BIDS – Click Here