Grain Futures Strenghen on Short-Covering

September 19, 2012 01:32 AM

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Overnight highlights. Following are highlights of overnight trade (as of 6:30 a.m. CT) and opening livestock calls:

Corn: 3 to 8 cents higher. Corn futures are being lifted this morning by short-covering on ideas recent losses have been overdone. But without fresh news, upside potential is also being limited. Harvest is progressing quickly and there's little fresh demand news to digest.

Soybeans: 17 to 23 cents higher. Futures are also being lifted by short-covering this morning. The Bank of Japan announced a monetary boost to address weak economic growth, but the U.S. dollar index is firmer this morning. If outside markets turn positive this morning on this news, it could provide spillover to the commodity markets.

Wheat: 11 to 15 cents higher. Wheat is enjoying spillover from neighboring pits after testing support at the bottom of the consolidation range yesterday. Also supportive for wheat is a tightening global stocks situation and concerns about dryness in Australia and the U.S. Southern Plains.

Live cattle: Steady to higher. Futures should see a lift this morning from strength in the boxed beef market and on spillover from expected strength in the U.S. stock market. Choice beef values rose $1.22 yesterday and Select was up $1.54 on solid movement of 176 loads. Strength in the beef market points to steady to firmer cash cattle trade later this week.

Lean hogs: Steady to lower. Futures are expected to be pressured by weakness in the pork cutout market, as values slipped $1.37 yesterday. Traders had hoped the market was stabilizing to suggest the worst is behind in terms of herd liquidation. The cash hog market is called steady to lower as packers work to keep profit margins well in the black.


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