CBOT futures closed lower with pressure coming from outside markets (weaker crude oil, stronger US$), optimistic weather forecasts in South America and U.S. corn export concerns. Corn futures fell to new contract lows and soybean futures extended losses for the 5th straight day with the market settling near the day’s lows. March Corn has weekly continuation support at 3.56 and 3.46. The January Soybean contract is down 27 cents over the 5 days. Chart support is 8.54 and 8.44. Chicago and KC wheat are threatening to break below contract lows while MGEX wheat closed at a new contract low. CFTC reports indicate spec funds are short wheat, corn and soybean futures, but have room to sell more if the trend remains their friend.

Cattle futures closed slightly lower after not seeing strong interest to add to last week’s HUGE price rally. That rally in futures outran the rise in cash cattle price and the boxed beef values. We’ll have to wait to Wednesday or Thursday to see if cash cattle can add to last week’s approximately $7/cwt gain, but boxed beef values finished strongly higher today. Choice carcasses were up 3.46 at 201.09; Select was up 3.73 at 193.20. At midday, Choice was up 1.82 and Select was up 3.06. Falling slaughter weights are constructive and winter temperatures will reduce productivity.

Lean Hog futures closed moderately higher, continuing the generally upward trend of the past 4 trading days. Strong pork cutout values were supportive. FOB Plant Pork +.84 @ 70.50 with hams up 6% and picnics down 3%. At midday, FOB Plant was up 1.80. The February LH contract may be lagging deferred LH contracts due to its strong premium to the current CME LH Cash Index near 53.50.

Ignoring the sharp drop in crude oil prices, Natural Gas futures soared 10 percent on forecasts of colder weather in the eastern U.S. This is on top of big gains made since the NG market bottomed on December 18 after being extremely “oversold”.

Corn Mar -3 361; Jly -3 374; Dec -3 386 Bean Jan -10 865; Jly -11 873; Nov -10 879 Meal -2 267 Oil -67 3020 Wheat Mar -1 466; Jly -2 481 KC -1 466; MGE -3 492 Oats +4 224 Rice +24 1106

LC Dec -25 13085; Apr -65 13737; Aug -45 12242 FC Jan -82 16265; Apr -77 15987; Aug -40 16242 LH Feb +82 5912; Apr +97 6605; Jun +95 7855 Milk Dec -2 1446; Jan +27 1361

 

US$ +.1% Dow -24 17528 SP -4 2056 NAS -8 5041 Tran -56 7567 VIX +1.17 16.91

WTI -141 3669 Brent -145 3644 Gas -3 123 NG +21 224 (+10%) HO -1 109 Eth -1 139 Gold -3 1074 Slvr -51 1385

2-yr +.009 1.011% 5-yr unch 1.718% 10yr -.011 2.232% 30yr -.018 2.945%