Grains Choppy Overnight As Traders Await Weekend Precip

April 13, 2012 01:21 AM

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Overnight highlights. Following are highlights of overnight trade:

Corn: Mixed. Futures favored a firmer tone overnight despite negative outside markets. Since Tuesday's sharp decline, downside risk has been limited by ideas the decline was overdone. But at the same time, upside potential is being limited by expectations new-crop plantings will go smoothly and the crop will be off to a solid start. But this weekend, planting will be delayed by a widespread rain event -- that is needed to recharge soil moisture in the Upper Midwest and central Illinois.

Soybeans: Steady to 5 cents lower. Futures were choppy overnight, but as of lately were softening on strength in the U.S. dollar index. Soybeans surged higher yesterday on rumors China's 1st-qtr. GDP would come in above expectations, but the overnight data came slightly below earlier expectations of growth at 8.1%. This is once again raising concern about a "hard landing" in the country, but economists say they don't expect the "slowdown" will continue for long. Still, after yesterday's strong gains, bulls maintain their hold on soybean futures.

Wheat: Mixed. Futures were mixed overnight, with Chicago wheat favoring a slightly firmer tone on spillover from corn. Still, strength in the U.S. dollar index will limit gains, as will expectations for abundant supplies in the year ahead. May Chicago wheat has returned to the mid-range of the long-lasting consolidation range, rebounding from Wednesday's plunge to avoid doing any technical chart damage.

Live cattle: Mixed. Following yesterday's surge higher, live cattle futures are expected to finish the week mixed as traders even positions. Nearby live cattle rallied to move back in line with the cash market, which traded steady at $121 to $122 this week. Meanwhile, beef prices were softer yesterday, with Choice down 36 cents and Select down 92 cents on solid movement of 228 loads.

Lean Hogs: Mixed. Packers have seen profit margins improve considerably this week, but still remain in the red. Pork cutout values slipped 71 cents yesterday to take back a good portion of the previous day's gains. The cash hog market is expected to be mostly steady today, as packers say they have Saturday's needs booked and are already preparing for next week's kill. April hogs are trading in line with the cash index, which will limit trading to position squaring to close out the week. s


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