Corn futures are roughly 3 to 6 cents lower this morning.
- Weekend rainfall fell short of what many had been anticipating, especially in northern and western areas of the Corn Belt. But the forecast calls for cooler temps and rain this week. Traders view this as a friendly forecast for crop development.
- Light pressure stems from news Japan's feedmillers are cementing deals for 300,000 MT of corn from Ukraine and Brazil for shipments in October through December.
- On the other hand, selling interest is being limited by expectations this afternoon's Crop Condition Update will reflect another decline due to last week's heat and dryness.
- Also, Gulf basis surged 20 cents for immediate delivery this morning, signaling tight supplies and possibly pending export business for U.S. corn.
- The last dip to the $5.00 area for new-crop corn was met with active end-user buying.
Soybean futures are enjoying double-digit gains, with the August contract 20-plus cents higher.
- Traders are showing a bit more concern about the impact of dryness on the slow-developing soybean crop, as rains in Iowa over the weekend were disappointing.
- Thus, soybean condition ratings are expected to again decline in USDA's Weekly Crop Condition Report this afternoon. Crop development will also remain delayed.
- And while the forecast calls for cooler temps and precip this week, precip amounts are expected to be light in the central and upper Midwest.
- All of this adds to concerns about the 2013-14 crop easing tight supply concerns.
- Gulf soybean basis firmed 5 cents for immediate delivery while other months were steady to 2 cents higher this morning, possibly signaling improved export demand.
Wheat futures are posting losses of mostly 3 to 5 cents in Chicago and Kansas City this morning, while Minneapolis wheat is narrowly mixed.
- Action in the Chicago and Kansas City wheat markets is tied to that of corn this morning.
- But Minneapolis wheat is benefiting from some light, corrective short-covering amid ideas the downside has been overdone.
- Also limiting buying interest is a favorably cooler, wetter forecast for the Northern Plains.
- And while global export demand is picking up, the U.S. is not getting much of the business. U.S. wheat prices are higher than other global exporters.
Live cattle futures are seeing light, choppy trade this morning. Feeder cattle futures are slightly higher.
- There's a limited reaction to Friday's Cattle on Feed Report, which showed On Feed and Placements in line with expectations and Marketings slightly above the pre-report guess.
- Cash cattle trade occurred at steady prices of mostly $119 in the Southern Plains Friday.
- Considering these neutral factors, traders are again on watch for signs of seasonal low in the product and cash markets.
- On Friday, Choice cuts fell 8 cents, marking the 11th consecutive session of declines. Select firmed 44 cents, but movement was light at just 127 loads.
Early pressure on lean hogs has given way to some light short-covering and mixed trade.
- The ongoing slide in the pork market is weighing on the cash hog market and limiting buying interest in lean hog futures. Packers continue to cut in the red.
- Unprofitable margins and the fact that most packers are well supplied through at least midweek has cash hog bids steady to lower today.
- Also, the market expects today's Cold Storage Report from USDA to show record-large frozen pork stocks as of June 30.
- The pace of declines in the pork cutout value has moderated, but prices continue to fall. On Friday, the pork cutout value fell 18 cents, but packers moved just 231.5 loads of product at the lower prices.
- While the cash hog index has been on the decline, it remains well above the $100 mark and at nearly a $5 premium to the August contract.