Grain markets struggle at midday
Corn futures are trading lower at midsession. Futures are extending losses into midday, trading 8 to 9 cents below unchanged. Prices are expected to trade choppy as the market reacts to USDA’s large cut to 2011/12 ending stocks as well as bearish news that private brokerage firm FC Stone has increased its production and yield forecasts for the 2012 corn crop. If solid losses continue in the soy complex, prices could be pulled lower before closing bell.
Soybean futures are trading lower at midsession. Although the market has remains under pressure, futures are trading well above session lows. The market is now down for the third consecutive day, and liquidation by both commercial and non commercial traders is preventing the market from reaching a point of stability. Private projections for better than expected soybean yields and increased production output is also weighing on the market. November soybeans are down 21 cents.
Wheat futures are trading lower at midsession. Wheat futures are down for the third consecutive day. Spillover pressure from the soy complex continues to plague the wheat market along with weak demand for U.S. wheat. Strength in the dollar index and favorable rains across the U.S. Plains will keep prices trading defensively during the day session. But, the market may find support and Ukrainian wheat harvest is down due to poor weather with further exports restrictions likely to happen. December wheat CBOT is trading 9 cents lower; KCBT is down 11 cents; and MGE is down 6 cents.
Live cattle futures are trading 33 to 38 cents higher at midsession. Cattle futures are up as expected strength in wholesale beef prices and higher cash prices. Both select and choice cuts were reported higher on Tuesday. Cash trade has yet to develop but prices are expected to be steady to $2 higher than the previous week. Another, supporting factor for the market especially deferred contracts is the decline in cattle slaughter, indicative of tightening supplies.
Lean hog futures are trading mixed at midsession. Nearby hog futures are strength supported by higher cash prices and a higher pork carcass value. Processor margins are good and so demand by packers should remain steady. However, firm losses in corn and soymeal markets are pressuring deferred contracts. October is trading 85 cents higher while December is trading 15 cents higher.