Pro Farmer Senior Markets Editor
From Pro Farmer
Updated as of 7:00 a.m. CT
Crude oil drops below support... Crude
oil futures fell through support at the November low yesterday, causing increased
pressure in the bean pit through the day. Bean futures also violated support
to dip below the two-month consolidation range. Given the increasingly bearish
technical makeup of the market, both moves increase the risk for additional
near-term price pressure.
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Opening calls. These calls originate
more than three hours before the open -- use caution, things change:
Corn: Steady to marginally lower. Futures were steady to just below
unchanged overnight in light trade. Futures spent yesterday pivoting around
unchanged and closed fractionally to 2 cents lower. Futures held in a tight
trading range throughout the day. While the market tried to firm on corrective
short-covering, buyer interest was limited as outside markets provided mixed
Soybeans: 2 to 3 cents lower. Futures saw slight losses overnight
in light trade. Futures opened firmer yesterday but quickly eroded as crude
oil futures broke support levels. How outside markets perform will largely
direct price action in the soy complex this month, especially with volume
likely to be reduced due to the holidays. That's not to say a major fundamental
development wouldn't move soybean prices -- it just keeps traders focused
on outside markets.
Wheat: 5 to 6 cents lower. Futures opened firmer and quickly
turned mixed. Choppy outside markets kept wheat prices choppy yesterday, but
upside potential through the day was limited by negative economic and demand
news. Egypt snubbed the U.S. on their latest purchase, and Iraq also reportedly
purchased Canadian, along with German and/or Russian supplies. As a result,
traders believe U.S. wheat is not competitively priced.
Cash cattle expectations: Watching beef market, futures. Cash cattle trade isn't expected until later this week, but cash
opinions are in the process of being formed. Most traders expect softer
cash bids after packers increased them $2 to $3 in the Plains last week.
Post-Thanksgiving beef movement has been very sluggish thus far and there
are concerns with how beef demand will be impacted by economic struggles.
Futures call: Weaker. Futures are called to open lower today on expected
weakness on Wall Street. Futures extended losses into the close yesterday
to finish near session lows. Persistent economic concerns caused traders to
use the early strength yesterday as a selling opportunity. With the low-range
close, cattle futures are susceptible to followthrough selling this morning,
especially if outside markets are price-negative.
Cash hog expectations: Mostly steady.
Early expectations are for mixed cash bids this morning, as some packers
say this week's needs have been mostly secured. Pork values were firmer again
yesterday, which should help maintain a steady cash tone.
Futures call: Mixed. Futures are called to open mixed, as upside potential
is limited by the premium futures hold to cash. Futures could see weakness
if cattle futures are sharply lower. The cash hog market is called mixed,
which could also limit buying interest. The CME lean hog index is projected
up 39 cents to stand at $54.10. December hogs hold around a $4 premium to