Corn futures are posting losses of 3 to 4 cents.
- The corn market is facing light selling pressure this morning as traders are favoring long soybean/short corn spreads after recently unwinding some of those positions.
- Traders are also reacting to USDA raising the amount of corn rated "good" to "excellent" by 2 percentage points to 55% yesterday, signaling some of the crop was able to benefit from rains last week. This translated to a 2-point improvement on Pro Farmer's weighted Crop Condition Index (0 to 500 point scale) to 344.
- With harvest underway, the market is also facing seasonal pressure. USDA yesterday reported that harvest was 7% complete as of Sunday. New supplies are weighing on interior basis levels.
- Selling interest is being somewhat limited by signs prices are rebuilding demand. Columbia bought 180,000 MT of 2013-14 corn this morning.
Soybean futures have pared overnight gains to trade 5 to 9 cents higher.
- Spreading activity with corn and mild short-covering amid ideas the downside has been overdone is lifting the bean market this morning.
- But the start of harvest means buying interest outside of short-covering remains limited. USDA reports that as of Sunday, harvest was 3% complete, which compares to 9% complete at this time for the five-year average.
- USDA left its "good" to "excellent" rating for the bean crop unchanged at 50%, whereas traders had expected a slight improvement in ratings. This provides underlying support.
- Meanwhile, our weighted Crop Condition Index (0 to 500 point scale) shows the soybean crop firmed 1 point to 335 last week.
- Technical chart damage the past few days means bulls will face strong headwinds as they try to rally the market today.
SRW and HRW wheat futures are posting losses of 1 to 4 cents this morning, while HRS wheat is slightly higher.
- Wheat is mostly lower amid spillover from the corn market.
- Beneficial rain in the forecast for winter wheat country is also putting light pressure on the SRW and HRW markets.
- USDA data yesterday indicated that winter wheat planting is 23% complete, which is just one percentage point below the five-year average.
- The report also showed spring wheat harvest is in line with the five-year average pace at 93% complete as of Sunday.
- But selling interest is limited as recent export data signals strong demand for U.S. wheat and the recent price break in the U.S. dollar index could further increase the attractiveness of U.S. wheat.
Live cattle futures are posting slight gains in most contracts, while feeder cattle futures are slightly to moderately higher.
- Live cattle futures are enjoying cautious followthrough buying amid bullish product market news and early indications higher cash cattle trade may take place this week.
- Tightening supplies confirmed by last week's Cattle on Feed Report remains in traders' minds.
- And the boxed beef market got off to a strong start yesterday with both Choice and Select cuts posting solid gains amid decent movement.
- Also, yesterday's Cold Storage Report came in well below expectations as frozen beef stocks for the end of August were down 6.2% from the previous month.
- In addition, showlist estimates are down everywhere except Texas this week, setting the stage for firmer cash cattle trade again this week if the product market remains strong.
- But the front-month contract is already at nearly a $3 premium to last week's cash action at $124, which is keeping buying interest in check.
- Weakness in the corn market and tight calf supplies are lifting feeder cattle futures.
Lean hog futures gapped higher on the open and are enjoying moderate to sharp gains, with nearby contracts leading the charge.
- Traders are actively buying lean hog futures as they work to narrow the $6-plus discount the October contract holds to the rising cash hog index.
- News Smithfield Foods shareholders approved Shuanghui International's purchase of the company -- the final barrier to the deal -- is also lifting the market as traders expect this to expand export opportunities to China.
- Also, yesterday's Cold Storage Report is giving lean hog futures a lift as it showed frozen pork stocks well below year-ago and down 0.7% from the month prior and 7.8% below year-ago levels.
- Early cash hog bids are steady to lower today despite wide packer profit margins.
- The pork cutout value fell 9 cents yesterday and movement was light at 273.95 loads.