Corn futures are now favoring a firmer tone, although price action is mixed. Nearby contracts are trading mostly around 4 cents higher.
- Nearby corn futures are enjoying some short-covering after earlier being under pressure.
- Much of the gains are being attributed to end-of-the-year position squaring. But traders will continue to take a cautious approach as they close their books for the year.
- This morning's weekly export inspections data showed corn inspections of 7.906 million bu., coming in below expectations.
- March corn futures are hovering just beneath the psychological $7.00 level, but have a lot of work ahead in order to return control to market bulls.
Soybean futures have trimmed losses, with the January contract moving into positive territory. Deferred futures are mostly 1 to 3 cents lower.
- Light short-covering has helped lift soybean futures off their daily lows. But buying is being limited as fiscal cliff concerns remain on traders' minds.
- Buying is also being limited by forecasts for more rains in Brazil this week.
- Traders have largely ignored news that an unknown destination purchased 140,000 MT of U.S. soybean for 2012-13.
- Weekly export inspections of 35.537 million bu. were within traders' expectations.
- January soybean futures saw trade above resistance at Friday's high overnight and then dipped below support at Friday's low. The contract is now trading mid-range.
Chicago and Kansas City wheat have turned narrowly mixed, with Minneapolis mostly 2 to 5 cents lower.
- Wheat continues in a follower's role and is mimicking price action in the corn pit.
- Without fresh news for the market to digest, traders are focused on end-of-year positioning.
- Weekly export inspections of 7.763 million bu. were a disappointment.
- Bears still hold the near-term technical advantage, as March Chicago wheat futures continue in its steep downtrend from the November high and have a lot of work ahead in order to turn the reigns back to market bulls.
Live cattle futures have favored a firmer tone this morning, but are trading mixed.
- Expectations for cattle supplies to tighten through 2013 are supportive for cattle futures as traders close their books on 2012.
- Additional support is coming from a solid start to the boxed beef market for the week, with Choice values up 70 cents and Select up 95 cents on solid movement of 105 loads this morning.
- However, buying is being limited as nearby contracts hold a premium to last week's $127 cash cattle trade ahead of the December contract's expiration.
- Feeder cattle futures are finding spillover from live cattle futures.
Lean hog futures are moderately to mostly sharply lower as traders factor in Friday's bearish Hogs & Pigs Report.
- Lean hog futures gapped sharply lower on the open and remain under pressure as traders react to Friday's Hogs & Pigs Report. The report showed nearly even category above traders' expectations and points to steady to slightly higher pork production in 2013.
- Traders are also being cautious due to uncertainties surrounding the fiscal cliff and working to narrow the premium nearby contracts hold to the cash index.
- Meanwhile, the cash hog market is mostly steady in light holiday trade. Key on Wednesday is if packers find themselves short-bought as many plants are working reduced shifts today and are closed Tuesday.
- February lean hog futures gapped sharply lower on the open, extended losses, but have returned to near opening levels -- still leaving a wide gap open.