Corn futures are called to open fractionally to 2 cents higher on short-covering.
- Corn futures ended the overnight session 1/2 cent to 2 cents higher on an overdue corrective (yet small) bounce.
- December corn futures are due for a time or price correction, as the 9-day Relative Strength Index has slipped well into oversold territory.
- But perceptions the weather is ideal for filling grain is limiting buying interest. Near-term weather forecasts call for normal to below-normal temps across the Corn Belt, accompanied by normal to above-normal precip.
- Meanwhile, China has approved its first commercial shipment of GMO corn from Argentina. A 60,000-MT shipment arrived in southern China in mid-July. Trader sources do not expect Argentine to ship a large volume of corn to China this year.
- Gulf corn basis is 5 cents weaker for immediate delivery to stand 75 cents above September futures to reflect softening demand.
Soybean futures are called mostly 2 to 5 cents higher amid short-covering.
- Soybean futures ended the overnight session mostly 2 to 3 cents firmer, with September ending a nickel higher on tight old-crop stocks. August beans, which are in the final week of delivery, finished 4 1/4 cents lower overnight.
- Key will be if early gains hold, as attitudes remain bearish. According to the 9-day Relative Strength Index, November beans are oversold and due for a time or price correction.
- Perceptions the weather is nearly ideal for pod-filling soybeans limited overnight buying. A lack of excessive heat and timely rains are expected well into next week.
- Meanwhile, China's interest in booking new-crop soybeans has improved. This morning USDA announced a 220,000-MT purchase, which follows yesterday's purchase of 110,000 MT.
- Gulf soybean basis is steady for immediate delivery to stand $1.70 over November futures and is 5 cents firmer for September shipment this morning to stand $1.15 over November futures.
Wheat futures are called 1 to 3 cents lower on light profit-taking following yesterday's gains.
- All wheat flavors ended the overnight session 1 to 3 cents lower to signal yesterday's light bounce was clearly corrective in nature.
- According to the 9-day Relative Strength Index, wheat futures are hovering near, but remain out of, oversold territory.
- This signals there is more near-term downside risk for the market, especially if corn and soybean futures continue to weaken.
- Without any fresh demand news for the market digest, it's difficult for wheat to generate any kind of sustained buying interest..
- Meanwhile, better-than-expected yields reported in France signal the much-talked-about EU crop recovery will be realized.
Live cattle futures are called to open slightly firmer on followthrough from yesterday's gains.
- Live cattle futures slipped into the close yesterday, but still posted slight gains. Another quite start to the day is expected, with futures favoring a firmer tone.
- Meanwhile, traders are cautiously optimistic about a low being close for the boxed beef market. Choice values firmed 71 cents and Select rose 36 cents yesterday. But movement at 144 loads remains lackluster.
- This week's cattle showlist is about steady with last week and general expectations are for at least steady cash trade after packers raised bids late last week.
- While boxed beef movement continues to disappoint, beef exports in June were the largest of the year in terms of volume and value, with Japan the lead buyer.
- Feeder cattle futures are expected to find support from tightening calf supplies, although light short-covering in corn futures this morning could limit buying interest.
Lean hog futures are called to open steady to firmer on strength in the pork market.
- Lean hog futures are expected to build on recent price strength as the near-term technical outlook has brightened.
- Additional support is expected from strength in the pork market after values improved 80 cents yesterday on solid movement of 361.5 loads.
- With packers' profit margins improving, demand for cash hogs is also improving. As a result, the cash hog market is called steady to firmer in some Midwest locations.
- Pork exports in June of 169,098 MT were up 2.4% from the previous month and were the highest tally of the year.
- August lean hog futures are trading in line with the cash index, while October hogs hold around a $14 discount and will soon be the lead-month contract.