Negative Outside Markets Weigh on Grain Market

October 4, 2011 01:44 AM

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Overnight highlights. Following are highlights of overnight trade and opening calls:

Corn: 7 to 11 cents lower. Futures were pressured overnight by negative outside markets. Concerns Greece will default on its debt by the end of the year are growing, causing the U.S. dollar index to strengthen. Additional pressure is coming on a pickup in harvest, with clear weather expected across the Corn Belt this week. December corn is testing $5.80.

Soybeans: 6 to 8 cents lower. Futures continue to soften amid a pickup in the harvest pace as well as negative outside markets. The U.S. Dollar index is testing the $80.00 level and front-month crude oil futures are pivoting around $76.00 this morning amid sharp pressure. This combination has bears clearly in charge, although some bottom pickers were seen in late trade yesterday -- signaling prices are being seen as more of a value.

Wheat: 7 to 14 cents lower. Futures were softer again overnight on spillover from neighboring pits and negative outside markets. Concerns about the global economy are bolstering the U.S. Dollar, raising concern about the competitiveness of U.S. grains on the global markets. December Chicago wheat is pivoting around $6.10 overnight.

Live cattle: Mixed. Bulls hold the near-term advantage, but some profit-taking is expected today as traders wait on cash trade to develop. Weakness in the U.S. stock market this morning will also limit buying, although cash expectations are for higher trade this week given the smaller showlist and strong start to the week in the beef market.

Lean Hogs: Mixed. Futures are called mixed amid spreading. Traders worked to narrow the premium October hogs hold to the cash index yesterday, although pressure was limited by positive cash fundamentals. The cash market is expected to be steady to firmer today as packers work to move as many hogs as possible through the lines given profitable margins. Also, competition with harvest has increased demand for hogs.


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