Corn futures softened to narrowly mixed trade with the open of pit trading.
- Corn futures are enjoying light spillover support from soybeans and a weaker U.S. dollar, but buying interest has faded from earlier.
- Persistent rains in Argentina have raised the chances more acres will be switched to soybeans, adding to supply concerns.
- But this is countered by lackluster demand for pricey U.S. corn.
- This morning, Gulf basis levels are steady.
Soybean futures softened slightly to trade 4 to 10 cents higher through the August contract and slightly lower in far-deferred months.
- Soybean futures continue to benefit from concerns about tight supplies.
- With harvest in the U.S. largely complete, traders are paying more attention to the South American growing season. Mato Grosso, Brazil remains largely dry, which has delayed planting and raised concerns about the condition of the crop that has been seeded.
- Plus, soybean demand has been solid and farmer selling has slowed as some are storing beans in hopes of higher prices. Traders expect USDA this afternoon to show harvest moved to 82% complete as of Sunday.
- Traders expect this morning's Export Inspections data to show another strong soybean tally between 40 million bu. and 50 million bushels.
Wheat futures have pared gains to mostly 4 to 6 cents at all three locations.
- Wheat continues to benefit from Friday's news that Ukraine will ban grain exports beginning Nov. 15.
- This has sparked talk Russia will do the same, though the country's ag minister continues to say he opposes such actions. Regardless of whether this occurs, exports from the region will slow as it runs out of grain. This will boost U.S. wheat export prospects.
- But gains are being limited by a favorable start for the U.S. Southern Plains winter wheat crop. But drought remains in effect for most of the region, meaning timely rains are needed.
Live cattle futures are enjoying slight to moderate gains this morning. Feeder cattle futures are choppy.
- Deferred contracts are leading to the upside after Friday's Cattle on Feed Report showed Placements and Marketings below expectations, encouraging bear spreading.
- Adding to the bullish tone is Friday's firmer cash cattle trade at $127 to $127.50; October live cattle futures are at a slight discount to these prices.
- But gains are being limited by a pullback in the boxed beef market both in terms of prices and movement Friday.
- Feeder cattle futures are mixed as traders weigh strength in the corn market against tightening calf supplies.
Lean hog futures are off to a narrowly mixed start, with nearby contracts favoring the downside and deferred months the upside.
- Packers are still enjoying profitable cutting margins as the pork cutout value firmed Friday, but some weaker cash hog bids may be seen as packers are thought to be well supplied for the week. Early cash hog bids are mostly steady, however.
- On Friday, the pork cutout value rose $1.26, but movement slowed to 33 loads.
- Weakness in nearby contracts signals traders still expect the market to soften over the near-term, as is the seasonal trend.
- Traders are also readying for this afternoon's Cold Storage Report. It is expected to show pork stocks at the end of September at 620.3 million pounds, which would be a record-high for the month.