September through July corn futures are 3 to 5 cents lower on light profit-taking, with far-deferred mostly steady to slightly lower.
- Yesterday's crop condition ratings showed further deterioration in the corn crop, but without fresh demand news, traders are opting to take some profits out of the market.
- Gulf corn basis is steady to 1 cent lower this morning. Demand has softened as exporters prepare for Tropical Storm Isaac to make landfall in the Gulf.
- December corn is pivoting around the psychological $8.00 level as traders allow futures to consolidate as they wait for the next batch of market-moving news.
September through March soybean futures are 5 to 12 cents lower, with farther deferred contracts mildly firmer amid bull spread unwinding.
- Traders are basically ignoring yesterday's deterioration in crop condition ratings, which signals weather concerns are factored into prices (for now).
- Remnant rains from Tropical Storm Isaac are expected to push into areas of the Corn Belt later this week. That should help filling soybeans, although conditions will be hot and dry ahead of those expected rains.
- Supportive demand news should stabilize soybean futures. USDA announced China purchased 110,000 metric tons (MT) of soybeans for 2012-13, signaling prices have not yet dramatically slowed use.
Wheat futures are slightly lower at all three exchanges, with Kansas City leading the mild price decline.
- Without any fresh demand news for traders to digest, wheat is vulnerable to spillover from neighboring pits.
- Weakness in the U.S. dollar index is helping to limit price pressure in commodity markets this morning. Investors are waiting to see if the U.S. and EU central banks will
announce fresh monetary stimulus initiatives later this week.
Live cattle futures are called to open mixed as traders wait on cash trade.
- Following yesterday's late-session weakness, live cattle futures are called to open mixed on some short-covering as traders wait on cash cattle trade.
- Weakness in the boxed beef market will limit upside potential in live cattle futures to short-covering, as Choice values slipped 16 cents and Select declined $1.36 yesterday.
- This week's cattle showlist is lighter, but packer demand is expected to be lighter ahead of the holiday weekend.
Lean hog futures are called lower based on plentiful supplies.
- Not only are supplies building seasonally, but producers are actively moving sows to market, which is adding further strains to the product pipeline.
- The pork cutout value slipped $1.60 yesterday, which signals supply is outpacing demand.
- The cash hog market is called 50 cents to as much as $2 lower as packers work to improve profit margins.
- Meanwhile, pressure on futures should be limited by the already hefty discount nearby contracts hold to the cash index.