Corn futures softened with the open of pit trading to narrowly mixed trade.
- Nearby corn futures benefited earlier from light short-covering amid ideas the downside was overdone yesterday. But another day of dollar strength is tempering buying interest.
- Light support also comes from news of a 158,496-MT corn sale to an unknown destination for 2012-13.
- But countering this is news one South Korean feed miller passed on a tender for 55,000 MT of corn due to high corn prices, while another feed miller from the country bought 68,000 MT of optional origin corn.
- Ongoing planting delays in Argentina up the odds acres will be switched to beans, which is also providing light support to corn futures.
Soybean futures trimmed gains with the open of pit trading and are now mixed.
- Ideas the downside was overdone yesterday is encouraging light short-covering today.
- But buying is being limited by strength in the U.S. dollar index as traders keep a close eye on global and U.S. economic concerns.
- Improved weather conditions in Brazil continue to limit buying interest in soybeans, as this ups the odds production will indeed be record-large.
- Pre-report expectations for this morning's Weekly Export Inspections Report are for another tally reflecting strong demand. If realized, this may spark additional bargain buying as South American supplies will not ease the supply situation until early 2013.
- Gulf basis levels surged 13 cents for February delivery, reminding the market that supplies are tight and demand is strong.
Wheat futures are a mixed bag with Chicago futures slightly lower and Kansas City and Minneapolis wheat narrowly mixed.
- Chicago wheat futures are seeing light followthrough selling today amid ongoing dollar strength.
- Ukraine's prime minister said the country will not cap its exports this year, contrary to comments by the country's ag minister. Nevertheless, dwindling supplies mean the country will not be a major player in the export market.
- But downside risk is limited as the market expects this afternoon's crop condition data from USDA to show the crop deteriorated last week as the Plains remain worrisomely dry.
- But the market has grown impatient waiting for tightening world stocks to translate to increased demand. Another lackluster export inspections tally is expected for the week ended Nov. 8.
Live cattle futures are under light pressure this morning. Feeder cattle futures are slightly to moderately lower.
- Traders are engaging in some light selling as most expect cash cattle trade to take place at lower prices, despite signs the boxed beef market may be working on a short-term low. Both Choice and Select boxes rose in price yesterday and movement was solid.
- Showlists are heavier at all locations this week and packers are preparing for a holiday- shortened slaughter schedule next week.
- Plus, packers continue to face deeply negative profit margins, which will make them unwilling to raise bids from last week's $124 to $126 trade on the Plains.
- But pressure is being limited by expectations Friday's Cattle on Feed Report will reflect tightening supplies.
- A lack of buying in live cattle and early gains in the corn market are weighing on feeder cattle futures.
Lean hog futures are enjoying moderate gains in nearby contracts, while deferred months are mostly slightly higher.
- Nearby lean hogs gapped higher on the open and are benefiting from technically driven bull spreading activity.
- December futures continue to benefit from the slight discount it holds to the cash hog index.
- But buying interest will be kept in check by a 90-cent decline in the pork cutout value yesterday, though movement was solid at 61.75 loads.
- While packers continue to enjoy wide profit margins, ample supplies and the fact that they are preparing for back-to-back holiday-shortened weeks, means they have little reason to raise bids. Thus the cash market is again steady to lower.