Soybean Traders Concerned About Pod Fill Conditions

July 20, 2012 02:52 AM

On vacation. Next week I will at the county fair! On top of the market-related news Brian Grete provides in his "What Traders are Taking About" column, he is going to include a brief outline of overnight price action. Have a good week...

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Overnight highlights. Following are highlights of overnight trade as of 7:55 a.m. CT and opening livestock calls:

Corn: 7 to 14 cents higher. Futures are strengthening this morning on spillover from sharp gains in the bean pit. Front-month September corn has been choppy this morning, with increased farmer selling pressuring basis. Meanwhile, the hottest week of the year lies ahead. Forecasters say temps in the 100s will be common next week across the Corn Belt and there's limited moisture relief in sight.

Soybeans: 12 to 30-plus cents higher. Nearby futures are leading gains in early trade, with August through November futures 30-plus cents higher. August has posted another all-time high above $17.75 -- making $18.00 bulls' next target. The hot and dry forecast for next week raises concerns about the condition of the crop ahead of the key pod filling stage.

Wheat: Mixed. Wheat is favoring a firmer tone in mixed trade, with pressure on futures limited by spillover from neighboring pits. Bulls clearly hold the reigns in the wheat market, but if corn signals it is working on a near-term high, it will be more difficult for wheat to continue in its uptrend.

Live cattle: Steady to higher. Futures are expected to see a lift as traders work to even positions ahead of this afternoon's key reports. Getting the most attention will be the Cattle Inventory Report, expected to reflect a tightening supply situation, but also some heifer retention. Futures have also seen a boost from expectations Japan is closer to finalizing its rule to expand beef imports from the U.S. to 30 months from 20 months or younger.

Lean Hogs: Mixed. Futures are called mixed after yesterday's choppy session, but pressure should be limited by the tightening supply situation. Also, pork cutout values improved 79 cents yesterday to further provide evidence of a near-term low being in place. The cash hog market firmed at many locations yesterday, but until packers get margins back in the black, consistent improved demand for hogs will be limited.


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