Corn prices are expected to open 6 to 8 cents higher on Thursday. Harvest pressure is easing and commercial interests are having a difficult time buying the corn they need. The corn market is also getting a boost from the bullish fundamentals for soybeans. Corn export sales, out later this morning, are expected to be bearish, while export sales of soybeans continue at an unsustainable pace. The market has been able to bounce off of last week’s lows and fund liquidation seems to be drying up.
Soybean prices are called 12 cents to 17 cents higher on Thursday. Soybeans are leading other crop markets higher early Thursday morning. Harvest pressure is easing and the supply and demand balance is very tight. The very strong export pace is expected to continue with Thursday morning’s Export Sales report. The November contract has bounced back above $15 and funds were buyers overnight.
Wheat prices are expected to open 5 cents to 8 cents higher Thursday. Wheat markets are expected to get spillover support from other crop markets, especially from soybeans. The export pace remains very slow and the Export Sales report that comes out on Thursday morning is expected to be bearish. The December contract has been in a slow but steady decline since July. However, the longer term outlook is generally solid and U.S. exports should increase as supplies from other countries begin to dry up.
Cattle futures are expected to open 10 to 40 cents higher on Thursday. There is still no activity in the cash cattle market with a pretty big gap between buyers and sellers. Traders appear to be waiting for a signal from the cash market before moving futures prices very far in either direction. There is a bullish undertone to the cattle markets and the Cattle on Feed report that will be released Friday is expected to show very low feedlot placements in September pulling the October 1 feedlot inventory below year-ago levels.
Hog prices are expected to open steady to 20 cents higher on Thursday. Pork cutout values continue to rise and processing margins are positive. This is a good sing with high slaughter levels and weights a little above year-ago levels. The December contract is trading well below the cash index, which provides support to nearby futures contracts. However, the Cold Storage report that will be released Monday is expected to show a big increase in pork supplies in storage. The average of the pre-report survey puts frozen pork supplies up 26% from the 2011 level. The December contract has rallied by more than $8.50 since early September.
Cotton prices are expected to open mixed on Thursday after the big up move on Wednesday. The overall cotton market fundamentals are generally bearish but the small amount of tenderable quality cotton that has been classed so far triggered a huge short-covering frenzy. It will take a little time for amount of tenderable cotton to catch up to demand levels which will support nearby futures. But deferred cotton prices continue to face big supplies and weak demand.