Dollar Strength Weighs On Grain Markets Overnight

March 12, 2013 01:37 AM

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Overnight highlights. Following are opening grain and livestock calls at 6:38 a.m. CT:

Corn: Mixed. Old-crop futures are narrowly mixed, with new-crop futures generally 1 to 2 cents lower amid bull spreading. Upside potential s being limited by strength in the U.S. dollar index and corrective trade following yesterday's gains. Strength in nearbys is being led by tight supplies, while upside potential in new-crop futures is being limited by recent moisture across the Corn Belt and expectations for a larger crop to replenish supplies.

Soybeans: 6 to 12 cents lower. Losses are evenly distributed across the board this morning, with futures seeing profit-taking due to strength in the dollar index and concerns about the Chinese economy. Feed buyers say there are indications livestock producers, who's margins have slipped into the red, will trim production. But the ebb and flow of Chinese demand is nothing new.

Wheat: 2 to 4 cents lower. Wheat futures are weaker this morning on spillover from neighboring pits and strength in the dollar index. But a widening of the corn:wheat spread signals traders aren't concerned about the premium May corn holds to May Chicago wheat, as it hasn't given wheat demand a dramatic boost.

Live cattle: Mixed. Futures are expected to be mixed following yesterday's gains as traders wait on direction from the cash market. Boxed beef prices started the week mixed, with Choice up 40 cents and Select down 67 cents on decent movement of 103 loads. This week's cattle showlist is up slightly in Nebraska, Kansas and Texas, giving feedlots less bargaining power unless beef movement picks up.

Lean hogs: Mixed. Futures are expected to be mixed today, with some followthrough from yesterday's losses possible. The cash hog market is expected to be steady to weaker today amid light demand. Pork cutout values firmed 69 cents yesterday, but demand for hogs remains lackluster as margins are tight. Meanwhile, nearby hogs are trading at around a $3 premium to the cash index, which will limit buying to bottom picking.


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