Corn futures are called mixed to higher after maintaining some traction overnight. Dec corn was up 2-1/2 cents to 3.76-1/2 to lead the way. It was estimated that, on Friday, funds bought 20,000 contracts of corn and additional contracts yesterday. This could be the start of short covering as a significant chunk of the corn crop remains unharvested which could signal a downward correction in the January crop reporting of this year’s total production number. A lack of farmer selling and good basis levels suggest prices can move higher.
Bean futures moved higher overnight, tacking on 4 cents in an overall challenged technical picture. Overall the market looks very weak after Jan beans closed lower 8 consecutive days, and charts suggest another 10-20 cents down. However, demand remains solid with export inspections running ahead against USDA projections. March soybeans are situated mid-range of yesterday’s 15 cent trading range between 8.97-1/2 and 8.82-1/2.
Wheat futures are higher this morning with Chi winter wheat contracts up 4 and KC up 6. Prices failed to sustain Friday’s gains yesterday but the near term trend remains firmer, as concerns over fewer acres in the U.S. and declining crop conditions in Australia provide support. A rather major pullback in the dollar is also supportive from an export point of view.
Cattle futures are called steady. Prices ended softer yesterday in the front months but closed near the day’s highs, with Feb losing 40 and Dec 45. Considering the length of the rally, this technical trade looks uneventful without a good topping signal yet.
Hog futures are called mixed to lower on follow through after a poor finish yesterday, in which Feb lost over 2.00. Daily supplies continue to be more than adequate, with yesterday’s slaughter estimated at 497,000, compared to 470,000 a year ago.