Corn futures are mostly around 7 cents lower, with December leading declines.
- December corn futures have moved through support to hit new 2013 lows.
- Corn futures are lower in negative reaction to the EPA proposed to lower the corn-for-ethanol component of the Renewable Fuels Standard for 2014 relative to the mandated level and 2013 levels.
- Ethanol proponents point out ethanol markers are posting strong margins, which suggests actual demand could run higher than the proposed mandated level.
- But market attitude remains heavily bearish despite signs of strong export activity. The market is also seeing pressure from spread activity versus soybeans, which are higher.
- Traders are shrugging off a positive export inspections report which came in well above expectations at 30.76 million bu. and 13.6 million bu. higher than the previous week.
- Traders are also ignoring news of South Korean corn buy over the weekend and the weaker U.S. dollar index today.
- Farmer sales of corn have been light of late, which is helping to keep basis levels at interior locations steady. Gulf corn basis is also steady in late-morning trading.
Soybean futures continue to trade 6 to 9 cents higher on 2013-crop contracts. More deferred contracts are 4 to 5 cents higher.
- The weaker U.S. dollar index and strong export numbers has soybean futures marking gains in late-morning trading.
- Today's export inspections report came in at a strong 87.809 million bu., up 5.2 million bu. from the previous week and above expectations.
- Soybean futures are benefiting from spread trading versus corn, but chart watchers point out there it tough resistance at $13.00 for the January and March contracts.
- Weakness in the U.S. dollar index is providing support.
- But buying is being tempered by expectations for a record South American crop, as the weather has been favorable for planting and establishment of the crop.
- Gulf soybean basis is unchanged in late-morning trading.
Wheat futures have turned fractionally weaker after seeing mild gains in earlier trading.
- The slump to new calendar-year lows in corn futures has turned wheat futures negative.
- Selling is being limited by today's export inspections report, which showed 18.113 million bu. passing through inspections, up 5.6 million bu. from the previous week and above expectations.
- South Korean flour millers bought 47,200 MT of U.S. milling wheat this weekend, which follows an uptick in sales late last week.
- However, it could soon face stepped up competition from India as the country may soon resume wheat exports.
- Negative pressure is coming from ideas USDA will show the winter wheat crop is off to a very favorable start in this afternoon's crop condition update. The forecast for mild weather this week also limits buying enthusiasm.
- Gulf SRW basis is steady in late-morning trading.
Live cattle futures have softened to post sharp losses in nearby contracts and slight losses in more deferred contracts.
- Profit-taking continues to dominate trade, as December futures started the day priced slightly higher than the $132 price posted on the Southern Plains last week. The contract is now in line with last week's cash action.
- Choice boxed beef is 18 cents lower this morning but Select is up $1.32. However, movement is a light 75 loads.
- The weaker U.S. dollar index and the plunge to new calendar-year lows in corn futures is supportive.
- Traders know cattle supplies are historically tight and will await showlist estimates for additional insight as to this week's cash action.
- Feeder cattle futures are mixed with a downside bias as traders weigh spillover pressure from live cattle futures against weakness in corn futures.
Lean hog futures are narrowly mixed this morning with December futures unchanged.
- Lean hog market saw followthrough selling initially due to additional technical chart damage last week and slippage in cash hog prices.
- But weakness in corn futures and a weaker U.S. dollar has attracted limited buying interest, especially in more deferred contracts.
- Packer profit margins remain wide.
- But supplies continue to rise and cash prices are steady to $1 weaker as a result.
- News the pork cutout value rose 72 cents this morning and movement is decent at 210.91 loads has tempered some of the early bearishness.