Grain Markets Take on Calmer Tone

February 27, 2013 12:36 AM

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Overnight highlights. Following are opening grain and livestock calls at 6:35 a.m. CT:

Corn: Mixed. Futures are narrowly mixed this morning in lackluster trade. Weakness in the dollar index is limiting pressure on futures, but hasn't inspired fresh short-covering. A lack of fresh news is resulting in light trade volume. Interestingly, March corn futures are trading at around a 7 cent discount to March Chicago wheat futures to dramatically narrow the price spread.

Soybeans: Mixed. March through August soybean futures are 5 to 8 cents higher, with deferred futures steady to 4 cents lower. Sharp weakness in the dollar index is supporting nearby futures, although talk that China may release some soybean stocks from its government reserves to alleviate the tight supply situation is limiting buying. Backlogs at South American ports have kept demand for U.S. soybeans relatively strong, although the Brazilian shipping season will have a long tail.

Wheat: 2 to 6 cents higher. Futures are seeing a lift from weakness in the dollar index and some scattered business reported overnight. Futures are also building on yesterday's higher price performance but has a lot of work ahead of it in order to signal near-term lows have been posted.

Live cattle: Slightly higher. Futures are expected to enjoy followthrough from yesterday's gains as well as support from strength in the boxed beef market. Choice values improved $1.42 and Select rose $2.43 yesterday on solid movement of 166 loads. This week's snowstorm across the Plains has raised questions about available supplies and is expected to force packers to raise bids.

Lean hogs: Mixed. Futures are expected to see a choppy start, but could build on yesterday's mostly firmer price performance. But the cash hog market is expected to be mostly steady to weaker today as packers say this week's needs have largely been secured. Pork cutout values slipped 26 cents yesterday, which raises questions about pork demand.


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