Afternoon Comments 4/5/2013
Friday, April 5, 2013, 3:08 pmSubmitted by: Kyle Lehman
Both corn and soybeans closed lower today making it the 5th out of the last 6 trading days with lower closes. Corn did manage to hold yesterday’s low for nearby corn futures which may suggest the market is trying to form a bottom. Trade has been focused on trying to figure out what the ending stocks will be for Wednesday’s USDA S&D after last week’s stocks number threw people for a loop. The current average estimate is an increase of 204 mln bu. bringing the ending stocks up to 836 mln.
Soybeans were drug down on reduced demand from China after the new strain of bird flu has been reportedly responsible for 6 deaths causing the gov’t to kill 20k birds. The question remains: How much has/will this bird flu strain reduce demand? Chinese markets open back up on Monday which should give us a better grasp on the situation and long effects. For the time being expect the focus to remain on China and the bird flu as opposed to South America logistic problems.
Outside markets were bearish with crude oil trading nearly $5/barrel off the recent highs. Equities traded lower on the release of another poor jobs report that added 88K jobs for the month of March. Despite the poor job creation figure unemployment dropped to 7.6% indicating more people have stopped looking for employment. The 5 day forecast is calling for a good amounts of precipitation for the Delta and Western Corn Belt followed by a drier period that should allow planting to get started.
*Reminder new trading hours take effect Sunday night. Markets will pause in the morning from 7:45 to 8:30 am and have a new close of 1:15 pm. Night sessions will now open at 7 pm (graph below).
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