Grains Mixed Overnight as Traders Reevaluate Positions

June 26, 2012 01:40 AM

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Overnight highlights. Following are highlights of overnight trade (as of 6:45 a.m. CT) and opening livestock calls:

Corn: 3 to 4 cents higher. Futures are seeing light followthrough from yesterday's sharp to limit gains (limits expanded to 60 cents today). When USDA's weekly crop condition ratings are plugged into the weighted Pro Farmer Crop Condition Index (CCI; 0 to 500 point scale), the corn crop dropped another 11.65 points to 349.21, providing support to the corn pit overnight. While weather concerns linger, traders are awaiting a meeting of euro-zone leaders regarding the debt crisis.

Soybeans: 1 to 4 cents lower. Futures are seeing light profit-taking following yesterday's sharp gains, with pressure limited by continued deterioration in the crop and a building heat wave across the Corn Belt. When USDA's weekly crop condition ratings are plugged into the weighted Pro Farmer Crop Condition Index (CCI; 0 to 500 point scale), the soybean crop fell 8.47 points to 335.73.

Wheat: 12 to 14 cents lower. Futures are weaker on profit-taking following yesterday's sharp gains, with traders realigning positions as investors wait for EU leaders to meet on the debt crisis. The U.S. dollar index is weaker this morning, but investor sentiment is subdued after Moody's downgraded 28 of Spain's banks on sovereign risks and due to worries that a European Union summit this week will achieve little to resolve the region's debt crisis.

Live cattle: Steady to weaker. Futures are called to see followthrough from yesterday's losses, also some short-covering is possible as traders await more concrete cash clues. Choice beef values were 20 cents lower yesterday and Select declined 6 cents, but movement to start the week at 203 loads is strong and suggests retailers are gearing up for Independence Day features. This week's showlist is smaller in Nebraska, but this is offset by larger showlists in Kansas and Texas compared to last week to result in a total showlist similar to last week.

Lean Hogs: Steady to higher. Futures are expected to see some short-covering after yesterday's late-session sell off, signaling traders view a near-term high is in the works in the pork market. Pork cutout values improved 48 cents yesterday, but movement slowed to start the week with just 25.75 loads changing hands. Some packers have reduced kill hours this week to address negative profit margins, although tightening supplies has other packers raising bids. Early expectations are for steady to firmer bids again today.


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