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Overnight highlights. Following are highlights of overnight trade (as of 6:45 a.m. CT) and opening livestock calls:
Corn: 5 to 6 cents higher. Futures are slightly higher on light short-covering following two sharp days of price pressure. Yesterday's sharp losses validated Friday's bearish reversal, which points to additional near-term price pressure. But traders are also reacting to continued deterioration in the crop as reflected by yesterday's crop condition ratings. But traders are also keeping an eye on demand for signs that end-users are short bought.
Soybeans: 8 to 15 cents higher. Futures are firmer this morning on short-covering. November beans are using $16.00 as a pivot point, as prices have spent about the same time below this level as above it since mid-July. As expected, yesterday's crop condition ratings showed slight improvement in the crop and more mild weather is ahead -- although cooler and drier weather is expected next week. But traders feel like there has been an overall shift in the weather, which is less damaging for the crop.
Wheat: 6 to 8 cents higher. Futures are seeing spillover from neighboring pits as traders cover short positions following yesterday's sharp decline. September Chicago wheat violated support to post a monthly low yesterday and have only erased about a third of yesterday's decline. Slight weakness in the U.S. dollar index is also supportive of short-covering this morning.
Live cattle: Steady to higher. Futures are expected to see a lift from the beef market, as Choice values rose another $1.94 yesterday and Select climbed $1.77 on solid movement to start the week of 122 loads. August live cattle are trading at around a $2 premium to the top of last week's $119 to $120 trade -- signaling traders' attitudes toward the cash market remain positive.
Lean Hogs: Mixed. Futures are expected to see a mixed start, with some profit-taking possible following yesterday's gains. But traders are also working to narrow the gap nearby contracts hold to the cash index. October hogs, which will soon be the lead-month contract, hold around a $16 discount to the cash index. Meanwhile, the cash hog market is called steady to lower as packers have ample supplies to draw from. Pork cutout values slipped 33 cents yesterday, but packers' margins remain in the black.