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BRIAN HOOPS

By Staff | Mar 16, 2012

CORN ANALYSIS

Corn closed the week $.10 lower. Last

week, private exporters announced a sale of

126,000 metric tons of U.S. corn to South

Korea and 106,680 mt of U.S. corn to Japan.

In the weekly export sales report, corn

sales were 19.9 million bushels versuss 18

mb needed weekly to hit the USDA forecast

of 1.7 billion bushels.

The March supply/demand report typically

provides little direction for the trade with

major moves saved for the quarterly stocks

and acreage report at the end of the month.

Corn stocks came in unchanged from February

at 801 mb. Informa, a closely watched

crop forecaster, pegged U.S. corn plantings at

95.513 million acres, up 0.8 percent from its

January estimate of 94.748 million acres.

Farmers planted 91.9 million acres in

2011, according to the USDA.

Corn, on the weekly charts, remains

trapped between a sideways trading range

since the end of September. A break above

resistance of $6.65 should ignite significant

trade interest.

Strategy and outlook: Producers should

have 50 percent of 2011/12 crop production

sold. Producers should make a 30 percent

sale at $6.73. New crop sales should begin at

$6.05 with a 20 percent sale.

SOYBEANS ANALYSIS

Soybeans closed the week $.04 3/4 higher

from last week. Last week was a strong

week for soybean sales. Private exporters reported

a sale of 165,000 mt of soybeans to

China.

In the weekly export sales report, soybean

sales were 60.5 mb versus 7.8 mb needed to

reach the USDA forecast of 1.275 bb.

Soybeans stocks came in unchanged from

February at 275 mb. Informa projected soybean

plantings at 75.128 million acres, up

from its January forecast of 74.568 million.

Farmers planted 74.976 million acres in

have 80 percent of the 2011/12 crop production

sold. Producers have been making incremental

sales on rallies. Producers should

finish up 2011/12 sales on a rally into resistance

at $14.12 by selling the final 20 percent

of their inventory.

Producers should sell 20 percent of the

2012/13 production at

$13. 65 on a hedge to arrive

contract against the

November contract.

LIVE CATTLE

ANALYSIS

Live cattle ended the

week $3.92 lower while

feeder cattle ended $5.47

lower. Last week, cash cattle

trade was reported in the

North at mostly $203, $3

lower compared to last

week, while trade in the South was $127, $3

lower compared with the previous week.

USDA forecasted U.S. beef exports to increase

over the forecast period, gaining 14.2

percent from 2011 levels. That increase

would be more impressive if the U.S. industry

did not have to backfill a projected significant

reduction in beef exports in 2013 when

lower cattle numbers will limit the amount of

product available for both domestic consumption

and export.

Strategy and outlook: Producers are

hedged 50 percent of all production months

– April at $128.62; June at $126.65 and

August at $126.45.

Feed costs should be covered in corn futures/

options or cash product through July,

2012.

LEAN HOGS ANALYSIS

Lean hogs closed the week $2.60 lower.

The average Iowa-Minnesota hog weight for

last week was estimated at 276 pounds versus

275.9 lbs the previous week and 273.1

lbs last year. The USDA said the projected

increase of 503,000 metric tonnes for U.S.

pork exports is more than twice the increase

of the other five listed exporters combined.

The U.S. accounted for 35.6 percent of the

total exports of the six listed exporters in

2011. That share increases to 39.2 percent

by 2021 in USDA’s forecasts.

Strategy and outlook: Producers have extended

hedge coverage to 50 percent in all

months of production. April is hedged at

$94.55; June is hedged at $100.60; July is

hedged at $98.92 and August is hedged at

$97.00.

All feed costs should be locked in as well.

Brian Hoops is president and senior market

analyst of Midwest Market Solutions Inc. Midwest

Market Solutions is a full-service commodity brokerage

and marketing advisory service, clearing

through R.J. O’Brien. He can be contacted at

605-660-1155.

MARKET REPORT

Brian

Hoops

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