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Overnight highlights. Following are highlights of overnight trade (as of 6:40 a.m. CT) and opening livestock calls:
Corn: 1 to 3 cents higher. Corn futures benefited from short-covering overnight on help from positive outside markets, as well as from the strong cash market, which reflects a tight supply situation. Otherwise, there's little fresh news for the market to digest this morning, which has traders focused on the improving technical situation. December corn is challenging resistance at the October high of $7.76, which if violated, would open fresh upside potential.
Soybeans: 2 to 9 cents higher. Futures continue to be bolstered by commercial buying, which suggests export demand has been on the rise. Traders will be looking to this morning's weekly export sales report for guidance this morning, as a strong tally is expected given the recent pick up demand from China. Also supportive this morning are concerns over dry conditions in southern Brazil, although more favorable conditions are being seen in northern areas. Soybeans still have work to signal a near-term low has been posted, although bulls currently hold near-term momentum.
Wheat: Mixed. Futures are mixed this morning, with selling limited by weakness in the U.S. dollar index and from neighboring markets. But the lack of fresh demand news is limiting buying. Traders will take guidance from the weekly export data this morning. Meanwhile, traders recognize the poor start to the winter wheat crop as it goes into dormancy, but support from this factor is limited by the uncompetitiveness of U.S. supplies on the global market.
Live cattle: Steady to firmer. Futures are expected to see some followthrough from yesterday's gains as well as from strength in the boxed beef market. Choice values firmed 39 cents and Select was up 93 cents on strong movement of 204 loads. Traders say this raises optimism for $1 higher cash cattle trade with levels sold earlier in the week, although packer demand is in question given negative profit margins.
Lean hogs: Steady to firmer. Futures are expected to build on yesterday's gains, as traders are more confident with the premium nearby futures hold to the cash index due to strong demand for cash supplies. Packers are dealing with profitable margins and came into the week short-bought on supplies. As a result, the cash market is expected to be steady to firmer again today. Pork cutout values firmed 74 cents yesterday, which is also a supportive factor for the morning.