Grains Enjoy Short-Covering Overnight

October 18, 2012 01:38 AM

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Overnight highlights. Following are highlights of overnight trade (as of 6:40 a.m. CT) and opening livestock calls:

Corn: 3 to 5 cents higher. Futures saw a late-session boost yesterday as traders work to keep futures within the bounds of the choppy consolidation range. Futures are enjoying followthrough buying this morning and December corn is pivoting around $7.50 this morning. Traders don't want to be caught short ahead of this morning's weekly export sales data, although a very light sales tally is expected.

Soybeans: 11 to 16 cents higher. Soybeans are seeing strong followthrough from yesterday's high-range close as traders anticipate this morning's weekly export sales data will show lower prices have increased demand. Given the very strong start to the marketing year, export sales need to slow -- not accelerate -- in order to reach USDA's export projection.

Wheat: 4 to 6 cents higher. Futures are enjoying spillover from neighboring pits and followthrough from yesterday's late-session gains. However, there's little fresh news for the market to digest and the U.S. dollar index is firmer this morning. Still, traders anticipate demand for U.S. wheat will be improving soon given tightening of supplies in the Black Sea region.

Live cattle: Steady to higher. Futures are expected to see a boost from strength in the boxed beef market and this week's tighter showlists, which has traders looking for $1 to $2 higher cash cattle trade with last week's $125 trade. Choice beef values have risen above $195 and Select is above $180. Impressively, movement has been strong. Traders are also more actively evening positions ahead of Friday's Cattle on Feed Report, expected to show all categories below year-ago levels.

Lean hogs: Steady to higher. Futures have been choppy this week, but nearbys have continued to strength due to improvement in the pork cutout market. Pork values improved 92 cents yesterday to lift packers' profit margins. Packers have had plenty of supplies to draw from this week, which has kept cash bids steady.


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