Higher Stocks Dispel Thoughts Of Money Flow Into Commodities

US stock futures overnight are up, dispelling thoughts Friday that lower futures could lead to greater investment in commodities.  Agricultural commodities were up overall on Friday, but it was a tough slog, made that way by a higher US Dollar.\r\n   Stocks in emerging markets and the perennial safe haven, gold, appeared to be the beneficiaries of any change in investment plans, according to news reports.  The higher Dollar likely curbed any enthusiasm for commodities by cutting export estimates.\r\n   Overnight trading in commodities was subdued overnight, and prices are narrowly mixed this morning.  Bitter cold temperatures are holding down trader interest in doing much of anything.\r\n   Wheat is the leader in overnight activities as the latest arctic blast to sweep the country blankets the Plains states.  Much of the area’s wheat is unprotected by snow.  Soil moisture also is low, rendering the plants even more susceptible to winter kill.\r\n   The cold temperatures are expected to reach as far south as the Gulf Coast, with forecasts for freezing rain and ice in some southern cities.\r\n   The cold temperatures also are limiting the amount of grain and soybeans being sold by farmers.  Many are reluctant to get out in the cold and move grain from on-farm storage to the elevator, and basis levels are moving higher in an effort to lure them out.  \r\n   But even then, rail and barge movement is being hampered, if not halted, by the icy conditions.  Ice in the rivers, on the locks and under the barges keeps river movement to a minimum, while cold temperatures make railroad brakes very inefficient, requiring the use of more engines per train.\r\n   March corn futures is holding within a trading range and may remain in this range unless some major news pops up to jar it loose.\r\n   Soybeans are testing support as cheaper Brazilian soybeans are loaded out.  The world seems to be waiting on the doorsteps for Brazilian beans as a larger lineup of tonnage than last year waits to load at major ports.  \r\n   This year’s load-out was expected to be smoother than last year’s as steps have been taken to limit the amount of corn being shipped in favor of getting the soybeans out.  Corn’s turn will come later.\r\n   Friday’s USDA Cattle-On-Feed report was considered slightly bearish, and overnight prices are steady to lower as a result.\r\n   However, the report confirmed that cattle on feed for 90 days or more was at a 10-year low, meaning tight supplies of slaughter-ready cattle likely will continue for a while, AgResource said.  \r\n   Cash cattle and beef prices last week blew the doors off previous records, even though beef prices faded at the end of the week.  The USDA’s 5-area average price for slaughter steers was $148.45 per cwt on a live basis, up $5.80 from a week ago and $25.72 higher than a year ago.\r\n   The late-week weakness in beef markets led many to believe the latest seasonal run on beef and cash prices was over, and there was an increase in hedging that took futures a little lower on Friday.\r\n   The On-Feed report may bring in even more hedge pressure and speculative profit taking today, even though the actual numbers are historically tight.  \r\n   The USDA’s choice cutout was reported at $237.26 per cwt, down $1.29 on the day, and the select cutout was off $0.68 at $236.25.  The choice/select spread widened to $1.01, and there were only 71 loads of fabricated product sold into the spot market.\r\n   The CME Feeder Cattle Index for the seven days ended Thursday was $170.34, up $0.11, while the Jan futures contract settled Friday at $170.70 per cwt, up $0.32.\r\n