Corn futures have extended early gains to trade mostly around 4 to 5 cents higher at midday.
- Corn is enjoying spillover from soybeans and short-covering as funds lighten their short exposure to the market.
- Additional support is coming from news Japan purchased 278,384 MT of U.S. corn for 2014-15 delivery.
- After a one-cent gain this morning, Gulf basis is steady for immediate delivery at midday.
- But concerns linger about recent Chinese rejections of U.S. corn due to the presence of unapproved GMO content in shipments.
- Corn still has a lot of work ahead in order to signal a near-term low has been posted.
Soybean futures have extended gains to trade 5 to 11 cents higher.
- Soybean futures have extended early gains to return above resistance at yesterday's high.
- Continued strong export demand combined with yesterday's strong NOPA crush report is helping to lift the market as it signals there is still value at current price levels.
- But expectations for a record-large South American crop are high as conditions in the country are generally favorable. This has provided periods of profit-taking at the top of the current trading range.
- Therefore, it will be key if futures post a high-range close and see followthrough buying tomorrow.
- There are also some concerns China may cancel U.S. soybean orders as the country has bought ahead on its needs as insurance against any shipping troubles in Brazil or Argentina.
SRW wheat are favoring the upside in mixed trade, while HRW and HRS have softened and are now posting 1- to 2-cent losses.
- SRW wheat is enjoying spillover from the corn market, but disappointment regarding the export market is limiting buying interest.
- News Iran purchased wheat from the Baltic Sea and that Egypt purchased 120,000 MT of Romanian and Russian wheat reminds traders of ample global supplies.
- For now, traders have limited concern about another arctic blast that is expected the latter half of the week across the Plains. Recent milder temps have diminished protective snowcover on the High Plains.
- Bears still clearly hold the near-term advantage given recent technical chart deterioration.
- After slipping 4 to 5 cents this morning, Gulf basis is steady for near-term delivery at midday.
Live cattle futures have seen choppy trade this morning but are currently slightly lower. Feeder cattle have softened to post moderate to sharp losses.
- Live cattle futures are currently seeing a period of profit-taking.
- Limiting pressure are tighter showlists and the strong start to the week for the boxed beef market.
- Showlist estimates are down around 27,000 head from week ago, with Texas leading the decline.
- Choice beef values are up 21 cents this morning and Select is up $1.18 on lackluster movement of 63 loads.
- If the beef market can at least hold steady the remainder of the week, it would raise expectations for $1 higher cash cattle trade with last week's $131 trade.
- Strength in the corn market is weighing on feeder cattle futures.
Lean hog futures have softened to post slight to moderate losses.
- Nearby lean hog futures are being pressured by building supplies and the lofty premium those contracts hold to the cash market.
- Spreading, however, is helping to limit pressure on deferred futures.
- Pork cutout values are 2 cents softer this morning after rising $3.81 yesterday. Movement has moderated as 186.01 loads have changed hands this morning.
- The cash hog market is steady to lower as supplies are readily available.