Corn futures have strengthened to trade 1 to 2 cents higher in most contracts.
- Corn futures continue to consolidate amid what is expected to be a light week of trade.
- A risk-on attitude among investors to start the week thanks to weekend news of a surprise nuclear deal with Iran is supportive.
- Spreading activity with soybeans is also giving corn a lift.
- But strength in the U.S. dollar index and a record-large 2013 corn crop are tempering bullish enthusiasm.
- Generally favorable weather in Brazil and Argentina for planting and early development of the crop is also a limiting factor.
- While the corn market trended mildly higher last week, the overall chart pattern still favors market bears.
- News the head of China's Development and Research Centre says the country could lower its long-term corn self-sufficiency target is more of a long-term market factor, and thus is expected to have limited influence on the charts today.
Soybean futures have softened to trade 8 to 10 cents lower across the board.
- Strength in the U.S. dollar index this morning gave bears an early advantage. Selling picked up as the March contract dipped below the $13.00 support level. Thus far, the January contract is respecting this psychological level of support.
- The soybean market is also seeing some spreading activity with corn as traders exit positions for an extended holiday break.
- Traders are ignoring USDA's announcement of a 120,000 MT soybean sale to unknown destinations for 2014-15 this morning as strong demand is known. It will likely take impressive tallies or a flurry of daily sales activities to spur buying interest.
- Traders will receive an update on the demand front via this morning's export inspections report. Another week of impressive sales between 70 million bu. and 90 million bu. are expected.
Wheat futures are 3 to 5 cents higher in the SRW market while HRW and SRW wheat are up 2 to 3 cents.
- Freezing rain and even some snow is moving into the Southern Plains. There is concern this could damage the winter wheat crop.
- USDA will provide an update on the condition of the crop this afternoon.
- Gains in the corn market are also supportive.
- But news Iraq bought 120,000 MT of Canadian wheat and 50,000 MT of Australian wheat reminds that the U.S. is facing stiff export competition.
- Pre-report expectations are for weekly export inspections to come in between 11 million bu. and 18 million bu., representing tepid demand.
December through June live cattle futures are enjoying slight gains while deferred months are steady to slightly lower.
- There were no major surprises in either the Cattle on Feed or the Cold Storage Report Friday. Therefore, traders are shifting their attention back to this week's cash prospects.
- Cash cattle trade took place at mostly $1 lower prices of $131 in Texas and Kansas last week, while Nebraska saw trade at $131 to $132 -- steady to a buck below the week prior. Futures are trading in line with these prices.
- The boxed beef market improved Friday after seeing mixed to lower price action for much of the week. Movement also improved to 207 loads, despite the mild price increases for Choice and Select cuts.
- Packer profit margins deteriorated notably over the past week, which could make it tough for feedlots to get steady prices this week, especially with Thanksgiving downtime ahead.
Lean hog futures are enjoying slight to moderate gains in all but far deferred months this morning.
- Traders in the lean hog market are covering short positions as they are encouraged by the market's ability to consolidate after facing pressure in recent weeks.
- But the overall chart pattern and market fundamentals continue to favor market bears, as do rising hog supplies.
- Mostly steady cash hog bids this morning are also lifting futures, as packers are in need of supplies for Friday and Saturday's kill.
- While the pork cutout value did tick up Friday, movement slowed to around 300 loads.
- Friday's Cold Storage Report came in about as expected at the end of October.
- Concerns about the impact of the porcine epidemic diarrhea virus (PEDV) remain an underlying source of support for the market.