Grains Mostly Weaker Overnight Amid Dollar Strength

April 30, 2012 01:32 AM

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Overnight highlights. Following are highlights of overnight trade:

Corn: Mixed. Futures were narrowly mixed overnight, with pressure limited to light profit-taking after Friday's sharp gains on confirmation of large Chinese corn purchases. Exporters need more old-crop corn in position to fill needs, meaning basis should continue to firm until they get farmers to move more corn. Meanwhile, growing concern over Spain's economy led to strength in the U.S. dollar index overnight.

Soybeans: 2 to 9 cents lower. Futures were weaker overnight amid profit-taking spurred by dollar strength. Downside risk, however, will be limited as AgRural trimmed its estimate of Brazil's crop by 0.7% from last month to 66.24 million metric tons (MMT) due to late-season dryness. It's also the last trading day of the month, which makes it technically important.

Wheat: 4 to 8 cents lower. Futures were weaker overnight on strength in the U.S. Dollar index. Pressure should be limited as traders wait for frost/freeze assessments from the eastern Midwest, especially since crop development is ahead of its normal pace. Meanwhile, recent rains across the Central Plains are improving winter wheat prospects there.

Live cattle: Mixed. Futures are set for a mixed start as traders gauge cash market fundamentals. Boxed beef prices were weaker on Friday, but up overall for the week. Key early this week will be if values stabilize or continue to rise as packers saw profit-margins improve dramatically last week. Limiting buying will be expected weakness in the U.S. stock market, which is called lower after Spain's GDP signaled the nation is in recession.

Lean Hogs: Mixed. Futures are expected to be mixed amid spreading, but upside potential will be limited as traders work to narrow the premium nearby futures hold to the cash index. The cash hog market is expected to be steady to weaker today amid lackluster demand for hogs as packers work to improve negative profit margins.


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