Soybeans Remain as the Leader in the Grain Market

December 5, 2012 12:33 AM

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Overnight highlights. Following are highlights of overnight trade (as of 6:30 a.m. CT) and opening livestock calls:

Corn: 1 to 3 cents higher. Without fresh news for the market to digest, upside potential in corn was limited to short-covering. So far this morning corn has remained within the boundaries of yesterday's trading range. Gains are also being limited by a modest rally in the dollar index.

Soybeans: 3 to 9 cents higher. Soybeans continue to be the price leader in the grain market, with commercial buying lifting the market this morning. But key will be if this buying spills over into the day session, as followthrough buying has been difficult to generate recently. Rains are needed in dry areas of southern Brazil, and there's little in the near-term forecast, which makes traders nervous about the potential for record soybean production from the region. Importantly, January beans moved to a fresh weekly high overnight.

Wheat: Mixed. Wheat is favoring a firmer tone in mixed trade, but buying is being limited by a firmer dollar index and a lack of fresh news. Traders need a dose of fresh export news to encourage market bulls, but the weather situation in the Southern Plains remains supportive for the market. The HRW wheat crop will enter dormancy in the toughest shape since condition ratings began.

Live cattle: Mixed. Futures are expected to see a choppy start as traders wait on cash trade to develop. Expectations are for steady-at-best trade given this week's larger showlist. Moreover, the boxed beef market hasn't posted a strong performance this week. Choice values slipped 27 cents and Select was up $1.93 yesterday on moderate movement of 159 loads.

Lean hogs: Steady to weaker. Futures are expected to see followthrough pressure from yesterday's losses, as well as concern about the cash hog market. While pork cutout values firmed 23 cents yesterday, packers saw their profit margins slip further into the red. As a result, the cash hog market is expected to begin softening today, although some packers say they are still in need of supplies.


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