Corn futures are called 3 to 4 cents lower. Overnight trade at 6:45 am CT was 3 1/2 to 4 1/2 cents lower. Futures were able to rally on Monday despite strong losses in soybeans. But corn futures are setting back slightly overnight amid some talk of better than expected early harvest yields. However, losses are being limited by USDA’s lowered production estimate on Monday. USDA also lowered usage, but ending stocks are projected to be 672 million bushels, down nearly 250 million bushels from the previous crop year.

Soybean futures are called 7 to 8 cents lower. Overnight trade at 6:45 am CT was 7 3/4 to 8 cents lower. USDA’s bearish reports yesterday and some outside market pressure are weighing on the market. USDA surprised the market by raising its production estimate slightly, leaving ending stocks 10 million bushels above last month. However, losses are expected to be limited by the still tight ending stocks projections of 165 million bushels, which would still be down from the 225 million estimated for the end of 2010/11 crop year.

Wheat futures are called 5 to 9 cents lower. Overnight trade at 6:45 am CT was 4 1/2 to 5 cents lower at the CBOT, 7 to 9 cents lower at the KCBT and 7 1/4 to 7 1/2 cents lower at the MGE. The bearish USDA Supply/Demand report on Monday is expected to keep the market on the defensive. USDA estimated U.S. ending stocks well above trade expectations. In addition, global supply/demand estimates were bearish again. Forecasts for much needed rainfall in the southern Plains are bearish as improved soil moisture is needed for HRW wheat seeding.

Cattle futures are called steady to higher. Boxed beef prices were up $1.70 for both choice and select cuts on Monday. The improved cutout values will help improve packer margins. Cash trade is currently expected to be firm again this week as market ready supplies remain tight. Gains could be limited by concern about the global economy and ideas that high beef prices could slow demand.

Lean hog futures are called steady to higher. Cash trade and pork cutouts were near unchanged on Monday. But short-bought packers and favorable packer margins are expected to help cash trade be steady to firm today. However, gains will be limited by ideas of increasing numbers of market ready hogs.

Cotton futures are trading higher this morning. The market is expected to remain in a sideways trading range after traders had little reaction to the USDA reports on Monday. At 6:40 am CT, December cotton was 81 points higher.