Grains Start Week on Strong Note. Grain futures were lifted overnight by disappointing weekend rains in Argentina and Southern Brazil, as well as seeing help from positive outside markets. The U.S. dollar index is under sharp pressure this morning as traders are cautiously optimistic about Greece's debt talks. Euro-zone leaders begin a two-day meeting today and the debt situation will likely dominate the news. The dollar index is testing support at the December low. If violated, it would signal a near-term high has been posted, which would be supportive for the commodity world.
Traders have also renewed concerns about crops in South America after weekend rains weren't as widespread as expected and amounts weren't as large as hoped for. With little rain in the near-term forecast and many private forecasters once again lower their crop estimates, traders returned this morning to add some weather premium back into prices.
Lean hog futures started the week on a strong note after Friday's Cold Storage Report reflected demand stronger than expected. While the beef stocks estimate came in higher than expected, the Cattle on Feed Report reflected a tightening feedlot situation. More than anything, the report is friendly because traders actually hit the market on Placements -- coming in six percentage points below year-ago. Most of last year, Placements were high due to a lack of pasture in the Southwest.