Johnston Pro Farmer Senior Markets Editor
as of 7:00 a.m. CT
Index avoids support... For now, the commodity markets are "treading
water" above important support levels, as the Continuous Commodity Index avoided
slipping below 450.00 points yesterday, which would be a violation of uptrending
support (see yesterday's Bullpen).
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calls. These calls originate more than three hours before the open
-- use caution, things change::
Corn: 2 to 5 cents higher.
Futures were slightly higher overnight on spillover support. Futures posted
two-sided trade yesterday, but closed near session highs and closed 17 to 21 3/4
cents higher on support from outside markets. December corn briefly penetrated
support to post a fresh weekly low of $5.27, marking that level as near-term support.
Futures need to climb above resistance at Monday's high of $5.74 1/2 to attract
fresh technical buying interest. Key support lies at the August low of $5.05.
Soybeans: 7 to 12 cents higher. Futures were firmer overnight on
spillover support. Futures closed 11 to 15 cents higher yesterday on help from
outside markets. Crude oil was higher yesterday, while the dollar was weaker.
However, there is still concern about the financial sector, as the Dow Jones Industrial
Average was weaker again today. November beans briefly penetrated support at the
previous day's low, but then returned above unchanged. In order to improve the
technical outlook, futures need to clear resistance at last week's high of $12.20.
Wheat: 7 to 9 cents higher. Futures saw spillover support
overnight from yesterday's gains. Futures were sharply higher yesterday on support
from outside markets. That outside market influence caused short-covering in wheat,
which pushed futures through buy stops and triggered more buying. With the strong
close, bulls carry momentum into overnight trade. But to continue Wednesday's
upward push, outside markets must remain bullish.
cattle expectations: Watching beef trade. Choice beef values rose
46 cents yesterday and Select was up 25 cents. Beef prices are higher than last
week at this time, but so far this week, beef movement hasn't been very strong.
Movement picked up yesterday at 281 loads of cuts. Cash trade could begin today
as some packers signaled they are in need of supplies. That could result in steady
to $1 higher trade from last week's $99 trade.
Mixed. Futures are called to open mixed as traders reevaluate positions after
yesterday's choppy performance. Early strength came amid short-covering and outside
markets yesterday. However, concerns that economic turmoil will lower consumers'
spending on items like red meat limited buying. This will remain on traders' minds
as long as the stock market remains jittery.
hog expectations: Mixed. The cash hog market is called mixed as some
locations are in need of supplies and margins are well in the black, while others
have plentiful supplies. Packers planning on a larger Saturday kill are bidding
up for animals. Pork cutout values rose 90 cents yesterday to further lift margins.
Futures call: Mixed. Futures are called to open mixed
as traders reevaluate positions and due to spreading. October hogs were supported
yesterday as traders work to narrow the discount it holds to the cash index. The
index is projected down 90 cents to stand at $70.96 and October hogs hold less
than a $3 discount to the index -- which is considered "in line" since October
hogs still have about a month before expiration.