Market report for Monday March 25, 2013

Global markets are trading higher this morning as Cyprus has met the conditions for a bailout.
 
The U.S. dollar is trading lower this morning as markets adopt a “risk on” position – speculators view the U.S. dollar as a safe haven investment, a counter investment to higher risk investments like commodities.
 
Crops:
The crop sector is moving lower in the early session – despite the risk on profile of the markets. The USDA cattle on feed report released Friday afternoon showed a 14% year-over-year decrease in the number of cattle place on feed. Taken in conjunction with an expected 97.3 million of acres of corn and 78.35 million acres of soybeans to be planted this year (both would be record amounts), investors may be taking the view that feed demand may be lower at the same time as production increases.
 
Livestock:
Live cattle futures are poised to move higher this morning on Friday’s USDA report that shows the fewest number of head placed in US feedlots in the month of February since data tracking began by the USDA in 1996.
Speculators are modestly long cattle futures. Recently trading volumes have been very light – this could mean a higher potential for price volatility.
 
Disclaimer: This commentary is provided for information only and is not intended as advice.