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Overnight highlights. Following are highlights of overnight trade (as of 6:30 a.m. CT) and opening livestock calls:
Corn: 15 to 30 cents higher. Futures shot higher to start the session and have extended gains, with nearbys leading with gains around 30 cents. The fresh contract high in December corn above $7.70 makes $7.80 and then $8.00 bulls' next target. The lack of meaningful precip over the weekend and the forecast for rising temps this week and no precip in sight signals stress on the crops will continue to increase.
Soybeans: 30 to 40 cents higher. Futures gapped higher on the open and have extended gains, with November beans testing the $15.95 level -- putting $16.00 within spitting distance. Concerns about the crop amid hot and dry conditions are the catalyst behind gains. Traders expect this afternoon's crop condition report to show the crop declined further -- lowering yield expectations.
Wheat: 20-plus cents higher. Wheat is seeing spillover from the corn pit, with September Chicago wheat trading at around a $1 premium to corn futures and in line with Kansas City futures. Traders believe the smaller corn crop will increase demand for wheat has a feed ingredient. Also, global crop concerns have raised demand expectations for U.S. wheat.
Live cattle: Steady to lower. Futures are expected to start the week under pressure due to continued weakness in the beef market. Choice beef values declined $2.09 on Friday and Select was down 85 cents to further narrow the spread between the two categories. This signals demand for more expensive cuts has softened and traders say this points to more near-term cash weakness.
Lean Hogs: Mixed. Futures are expected to be mixed, with deferreds likely supported by lower farrowing intentions due to rising feed costs. Meanwhile, pork cutout values stabilized last week and movement remained strong -- raising expectations the pork market was nearing a low. The cash market is called steady to lower again today, however, as packers work to improve negative profit margins.