September through July corn futures are 18 to 20 cents lower, with far-deferred contracts around 8 to 10 cents lower.
- Ramped-up profit-taking pressure is being seen in corn futures on spillover from sharp losses in the soybean market.
- Following Friday’s key bearish reversal in nearby contracts, followthrough pressure today and a low-range close could signal the market is working on posting a high.
- Gulf corn basis is a nickel lower for August, signaling the market is doing its job of rationing supplies.
- Momentum is building to ease the Renewable Fuels Standard mandate due to tight supplies. More governors are expected to petition for a waiver, which could add pressure to the Environmental Protection Agency to do something sooner rather than later.
Soybean futures are posting double-digit losses, with nearby contracts 20- to 30-plus cents lower.
- Futures have extended early losses on profit-taking and chart-based selling after contracts failed to post a high-range close on Friday.
- Traders still have Friday’s bullish USDA reports on their minds, but are factoring in a milder weather forecast as they believe rains can still aid in filling pods. Scattered weekend rains were beneficial where they fell.
- Gulf basis is 7 to 10 cents lower for nearby delivery, signaling demand has softened.
Wheat futures are posting losses in the teens to 20-plus cents at all three exchanges.
- Wheat is seeing spillover pressure from neighboring pits, with futures slipping to fresh session lows ahead of the start of open-outcry trade.
- FranceAgriMer raised its soft wheat crop estimate to 36.5 million metric tons (MMT) from 35.9 MMT, saying late-season rains have boosted yields. This is in line with the estimate from France’s farm ministry, which pegs the crop at 36.7 MMT.
- Meanwhile, Morocco’s state-run grains authority said it received no bids in its tender to buy up to 300,000 metric tons (MT) of U.S. soft wheat.
- Gulf wheat basis is steady this morning.
Live cattle futures are called to open steady to firmer on late-week cash strength.
- Cash cattle trade was seen late Friday at $119 to $120, which is up $1 to $2 from the previous week, but total volume is still uncertain.
- Traders will be watching the boxed beef market closely this week to see if strong demand from retailers continues. Choice values rose $2.43 and Select was up $1.02 on Friday, giving traders encouragement to keep nearby contracts at a premium to the cash market.
- Feeder cattle are called higher based on weakness in the corn market.
Lean hog futures are called to open mixed with a downward bias based given plentiful hog and pork supplies.
- Lean hog futures are expected to favor a weaker tone this morning due to concerns about building pork supplies, but pressure should be limited by spillover from cattle futures.
- The cash hog market is called steady to lower as packers have needs secured into midweek and aren’t expected to have any difficulty securing additional supplies.
- Packers saw profit margins return to the black late last week, although that’s still not enough encouragement to actively pursue hogs.
