Corn futures are solidly higher in early trade Monday, though still in single digits. Ethanol blending is still profitable despite high corn prices. And the report from the CFTC Friday showing that speculative funds continue to add to their long position is an important factor, as fear that these funds may begin to liquidate at any time has been a tempering influence on other traders convinced that the U.S. production estimate may drop further yet. Early yield reports are even worse than anticipated. At this writing, Dec. corn is up 8 ½ cents at $8.15 ¼.

Soybean futures show strong, double-digit gains in early trade Monday. Despite high prices, there is still little evidence of demand rationing that must take place in a big way to leave even minimal ending stocks prior to the 2013 harvest. The July crush figures from NOPA came in 5 million bu. higher than anticipated. Also, the Friday CFTC report showing speculative funds still adding to an already large net long position adds to ideas that the U.S. crop yield estimate may drop further yet. Among nine previous low-yield years since 1970, yield came in lower than the August estimate seven times. At this writing, Nov. soybeans are up 15 cents per bu. at $16.60 ¾.

Wheat futures are mixed in early trade Monday. CBOT and MGE futures are slightly higher, while KCBT futures show both slightly higher and slightly lower bids in a random pattern across the board. Much needed rains in the U.S. southern Plains are a dampening impact on KCBT futures. On the plus side for prices, production estimates for Russia continue to fall. Now authorities there are warning the wheat crop may be less than 40 million tons compared to USDA’s August forecast of 43 million. At this writing, CBOT September wheat is up 2 cents per bu. at $8.96 ½; KCBT wheat is down ¾ cent per bu. at $9.09 and MGE September wheat is up 3 ¾ cents per bu. at $9.43 ¾.

Cattle futures are 25-35 points lower. Ideas that the beef market is close to a near-term peak and profit-taking ahead of USDA Cattle on Feed report later today has the cattle market on the defensive. The Cattle on Feed report is expected to show heavy placements during June although they are likely to be down from 2011’s record level. Placements during July are expected to be down 8% with marketings up 2% leaving August 1 cattle on feed up about 1%.

Hog futures are 30-60 points higher. Futures are a little firmer after trading lower most of the week. Still, gains are likely to be limited by increased slaughter and rising weights suggesting some liquidation of the breeding herd is underway.

Cotton futures are 48 points higher. Export demand and China’s trade policies remain the key market features, but recent FSA data on certified crop acreage suggests USDA’s cotton acreage figure may be too high.