Corn futures are 2 to 5 cents higher through the December 2015 contract.
- Corn futures continue to trade higher in a short-covering rally that saw March futures take out last week's high.
- Futures are gaining support from USDA's announcement of daily corn sales to Mexico totaling 167,750 MT. Of that total, 132,600 MT is for 2013-14, while the remaining 33,150 MT is for 2014-15 delivery.
- That sale to Mexico overshadows news China has now rejected five batches of U.S. corn totaling 120,643 MT this month, in addition to last month's 60,000-MT rejection. The shipments were rejected because they contain an unapproved GMO variety.
- But the rejected corn is reportedly being absorbed by other Asian countries who have approved the GMO variety.
- The Mexican sale indicates U.S. corn prices are seen as attracting export demand despite the negative news from China.
- Traders are shrugging off the weekly ethanol figures that showed a decline of 14,000 barrels per day in daily output and a rise in stocks of 102,000 barrels.
- Gulf corn basis is steady in late-morning trading after being 1 to 2 cents firmer for nearby delivery in early trading.
Soybean futures are 3 to 8 cents higher through the November 2014 contract with the lead-month January contract leading gains.
- Soybean futures continue to trade higher as export demand remains strong. Traders are expecting another strong weekly export sales figure tomorrow morning.
- Nearby January futures failed to take out Tuesday's low in followthrough weakness from Monday's bearish reversal. The rebound took out Tuesday's high, triggering buy stops. It takes a surge above Monday's high of $13.46 to completely negate the negative impact of the Monday's bearish reversal. But failure to follow through on the downswing today is worrisome to the bears.
- Gulf soybean basis is reported as steady in late-morning activity.
SRW and HRW wheat futures are mostly 1 to 4 cents lower, while HRS futures are mostly 4 to 8 cents lower.
- SRW and HRW wheat futures have again moved into the negative column on concerns U.S. wheat is not competitively priced in the global market..
- Statistics Canada pegs its 2013 wheat crop at a record 37.5 MMT, which is much higher than traders expected. HRS wheat futures are under pressure as a result.
- Traders are becoming comfortable with weather forecasts calling for sub-zero temperatures into the Central Plains. About 5% of the HRW wheat crop is seen as at risk, with some traders viewing projected snowfall totals as a positive.
- News Russia's ag minister has growing confidence the country's grain harvest will hit the 90-MMT level is also viewed as a negative..
- Gulf SRW basis is steady in late-morning trading.
Live cattle and feeder cattle futures are narrowly mixed.
- Trading activity remains very light and narrow as traders wait for cash negotiations to be completed.
- Showlist estimates are still reported as tighter, especially in Nebraska, which could give feedlots an edge in cash negotiations. But that's offset by negative packer margins.
- Some support is coming from this morning's wholesale trade. Choice boxed beef is reported as 65 cents higher and Select is listed as 58 cents stronger. Movement is a moderate 99 loads, but that is an improvement for Monday's extremely poor showing.
- Feeder cattle futures are mixed with buying interest limited by gains in corn futures.
Lean hog futures are mixed with the lead-month December contract under moderate pressure, while deferred contracts have a slight upside bias.
- December lean hog futures are under pressure as the contract continues to hold a premium to the cash index.
- Traders are starting to align the lead-month contract with the cash hog index, with expiration less than two weeks away. The premium is now down to about $1.80.
- The pork cutout value dropped 64 cents this morning and the holiday ham demand appears to have run its course. Movement is an encouraging 290.36 loads, however.
- Cash hog bids are mostly steady this morning but record average weights are seen as a negative going forward.