July corn futures are double-digit higher, with new-crop futures mixed.
- Tight old-crop supplies are again lifting the July contract.
- The December contract continues to flirt with psychological support at the $5.00 mark. The contract has dipped below that level, but thus far, no active sell stops have been triggered.
- Recent pressure on new-crop futures stemmed from USDA's acreage update last week that showed corn plantings were much higher than anticipated, despite the cool, wet spring in the upper Midwest.
- Adding pressure, corn crop condition ratings improved according to both USDA and the Pro Farmer Crop Condition Index yesterday.
- And the forecast for mild, dry conditions in the upper Midwest and showers in the eastern Belt is seen as favorable for crop development.
- Plus, Gulf basis fell 8 to 10 cents for immediate delivery, signaling increased farmer sales and/or softening demand.
Soybean futures are mostly 1 to 4 cents higher.
- The front-month July contract remains supported by bull spreading amid concerns about tight supplies.
- But somewhat offsetting such concerns are expectations for a rebound in production this growing season.
- Crop condition ratings ticked up for soybeans in yesterday's update from USDA and the market is not concerned about a slower pace of development than usual, especially as current conditions and the forecast are generally favorable.
- Also limiting buying interest, Gulf basis slid 8 to 18 cents for July delivery this morning.
Wheat futures are choppy this morning. At present, most contracts at all three locations are 3 to 7 cents higher.
- Corrective short-covering in the wheat market is lifting futures, though spillover pressure from corn is a limiting factor.
- USDA's crop progress data showed winter wheat harvest is 43% complete, which signals hedge-related pressure will remain a near-term market factor.
- Deterioration of the spring wheat crop and slow development over the past week is providing light support for Minneapolis wheat. Just 18% of the crop is heading, compared to 32% for the five-year average. Emergence is also 6 points behind the average pace of 99% at this time.
- Egypt bought 120,000 MT of Romanian wheat and 60,000 MT of Ukrainian wheat from its snap tender.
Live and feeder cattle futures have seen choppy trade this morning. Nearby contracts are currently favoring the downside.
- Live cattle futures have seen choppy trade this morning as the market continues to gauge whether a low is in place.
- An unimpressive start to boxed beef trade yesterday is limiting buying interest. Choice values slid 86 cents and Select fell $1.37 on light movement of 137 loads.
- But market action indicates traders believe a slight tightening in this week's showlist could encourage packers to pay higher prices for cash supplies. Packers are still enjoying wide profit margins. Last week sales took place at mostly $120.
- The recent price break in corn futures on higher-than-expected corn plantings are limiting selling interest in feeder cattle futures to profit-taking.
- Strength in the U.S. dollar index has encouraged bouts of profit-taking this morning.
Lean hog futures are mixed, with the front-month contract up slightly and deferred contracts slightly lower.
- The front-month contract is being supported by the $2-plus discount it holds to the cash index. But the index has fallen for six consecutive days.
- The rest of the market is being pressured by ideas a seasonal top may be in or near.
- The pork cutout value slipped $1.01 yesterday and the softer prices failed to spur strong movement. Just 226 loads changed hands.
- Meanwhile, cash hog bids are mostly steady today. Packers are preparing for a shortened kill schedule due to the Fourth of July holiday, but supplies remain tight and they are still enjoying wide profit-margins.