Corn traders were apparently ambivalent Friday morning about the belated release of the weekly Export Sales reports later that morning. The data seemingly favored bears, who proved able to force the market moderately lower Friday afternoon. The latest update of the weather models apparently confirmed rainfall potential over Argentine growing areas this week, but they also suggested the ridge of high pressure recently blocking rainfall over that region will return next weekend. We suspect that news supported CBOT corn futures in Sunday night-Monday morning trading and tend to expect more of the same when pit trading opens. March corn edged 1 1/2 cents higher to $7.22 1/4 in early activity, while December inched up 1 cent to $5.85 1/4 per bushel.

Although the Friday morning Export Sales report proved supportive of soybean futures, talk of significant Argentine rainfall this week seemed to limit rally attempts at this time. The fact the futures proved able to rise rather substantially at the Friday afternoon close may explain the fact that soybeans were trading in a mixed fashion in the early morning hours, despite continued expectations for South American rainfall this week. The potential for returning dryness next week may also have been confusing the issue. March beans were trading 2 3/4 cents higher, at $14.43 3/4 per bushel in pre-dawn trading, while March soyoil gained 0.03 cent to 52.13 cents/pound and March meal added $0.5 to $416.9/ton.

Sunday night/Monday morning news seemed generally supportive of wheat futures. For example, wire service stories out of Russia indicated a big slowdown in its wheat exports in the current crop year, as well as a 40% annual reduction in wheat stocks on January 1. Several countries also issued small tenders for wheat during the days just ahead. And yet wheat futures were generally lower in overnight electronic activity. Weather forecasts for the U.S. Southern Plains also seemed price supportive, since winter wheat fields in that area appear likely to experience continuing dryness. Thus, we do not have a good explanation for the slippage suffered by nearby wheat futures over the weekend. The markets could reverse quickly later this morning, but weakness in the face of positive news may signal larger pricing problems. March CBOT futures slipped 1 1/2 cents to $7.75/bushel in the early morning hours, while March KCBT wheat dipped 1 1/4 cents to $8.28 1/4 and March MGE futures fell 3 cents to $8.62.

Cattle futures rose moderately during the Friday run-up to the 2:00 PM CST release of the monthly USDA Cattle on Feed report. That seemingly presaged stronger gains today, since December placements fell short of forecasts, while late-2012 feedlot marketings easily topped expectations. Moreover, it was confirmed this morning that Japan will ease its age restriction (on February 1) on cattle from which American beef may be exported to that country from 20 to 30 months of age. We think that news will more than offset talk that Russia remains serious about enforcing controls on imports of U.S. beef and pork over the ractopamine issue. February cattle gained 0.43 cents to 126.30 cents/pound Friday, while April advanced 0.40 cents to 130.75.

Early-to-mid-week cash gains and widespread expectations for much of the same supported lean hog futures late last week. Not only was the nearby February contract trading at a discount to spot values, seasonal patterns historically imply sustained cash strength over the next 2-3 weeks. However, late-week cash and wholesale weakness appeared to undercut the Chicago swine market Friday afternoon. Late reports of sizeable cash losses had to be particularly disappointing, since many sources had argued that pork packers were running short of animals for operations planned for next week. We have to wonder if the Russian-ractopamine issue is becoming an obstacle to short-term bullish hopes. February hogs closed 0.22 cents to 86.82 cents/pound Friday afternoon, while June futures fell 0.52 cents to 97.12.

Cotton traders were very likely disappointed with the results of the Friday morning Export Sales report, since the stated USDA figure fell well below comparable week-ago and four-week average results. The market was clearly overbought as well, which probably exaggerated the subsequent price decline. The drop carried the nearby March future far back toward the 80-cent level after having reached 84.00 cents/pound Thursday. We tend expect further short-term consolidation in the wake of the big surge posted last week, but we will not argue that the modest gains posted in Sunday night trading does not represent a quick resumption of the recent advance. March cotton rose 0.23 cents to 80.75 cents/pound in Monday morning action, while December climbed 0.30 cents to 80.00.