Corn and wheat are higher early seeing a short covering bounce and corrective buying after the bloodbath Monday.
Kent Beadle with Paradigm Futures says the break in corn was overdone as a record crop is not made yet, but economically it puts most farmers in a position of negative profits.
He says soybeans are mostly lower with a correction in soybean oil dragging down the complex.
The forward spreads are working, an indication of old crop demand.
Meanwhile, November new crop soybeans make new lows for the move and three year lows at that.
Weather has been bearish with rains falling in dry areas of the Eastern Corn Belt as a result of Hurricane Beryl.
Plus crop ratings improved by 1% for both corn and soybeans nationally and 3% for spring wheat, which were all above expectations.
Another factor is the USDA report expectations are bearish with early estimates raising old crop and new crop ending stocks on all of the grains.
As a result funds have been massive sellers in the grain markets and have pushed to a record short position in the corn market and are also short in soybeans and wheat.
After some hedge pressure on Monday cattle are recovering with record cash trade last week for the fourth week in a row.
Funds added to their long positions in both live and feeder cattle as of last Tuesday.
Lean hogs continue to see bull spreading which Beadle says may also be some underlying demand.
