Corn futures are trading mostly 25 to 30 cents higher as traders add more weather premium into the market.
- Traders look for this afternoon's crop condition ratings from USDA to show continued deterioration in the crop. Building heat in the forecast this week keeps the crop on a path of continued stress.
- News that more than 1,000 irrigators across Nebraska were ordered by the state to stop pumping water from rivers and streams until drought conditions improve further adds to yield concerns.
- December corn is pivoting around $7.70 this morning, further extending the overbought situation of the market.
Soybeans are 30-plus cents higher on concerns about the hot and dry forecast.
- The National Weather Service forecast for July 21-25 calls for above-normal temps and below-normal precip for the bulk of the country, which is raising concern about the soybean crops' ability to hold blooms and add growth.
- Traders are actively adding weather premium into the market, as November beans started the week with a gap-higher open and have extended gains to pivot around $15.90. Clearing the psychological $16.00 mark is bulls' next objective.
- NOPA reports soybean crush in June at 134.156 million bu., which reflects a stronger-than-expected pace, as traders expected crush near 132.8 million bushels. Soyoil stocks declined slightly from the previous month to 2.306 billion pounds.
Wheat is mostly 20-plus cents higher at all three exchanges on spillover from corn and global weather concerns.
- September Chicago wheat is trading at around a $1 premium to September corn futures amid concerns a smaller-than-previously expected global wheat crop will increase demand for U.S. wheat.
- And this morning, USDA announced a 107,214 metric ton (MT) wheat sale to Japan for 2012-13; 69,784 MT is hard red spring wheat and 37,430 MT is soft white wheat.
- September Chicago wheat is pivoting around $8.75 this morning to post a new-for-the-move high and strengthen bulls' hold on the market.
Cattle futures are called to open lower on demand concerns.
- Traders are concerned rising temps across the country will temper grilling demand, which traders believe is behind last week's sharp decline in Choice boxed beef values.
- Drought conditions have resulted in stepped-up herd liquidation which puts more meat on the market near-term, but is supportive for deferred futures as it tightens supply availability for later.
- Cattle futures are also vulnerable to spillover from negative outside markets as investors wait for Fed Chairman Ben Bernanke's testimony before Congress tomorrow.
Lean hog futures are called to open steady to weaker on demand concerns.
- As with cattle, rising temps have traders concerned about consumers' demand for red meat. But last week, pork cutout values stabilized on improved movement. As a result, all eyes will be on the pork market to start the week.
- Packer margins improved last week, but remain in the red, which is expected to lead to steady to weaker cash bids to start the week.