Corn futures are trading 4 cents higher early morning. Prices are slightly higher this morning before the 7:30 am release of USDA’s WASDE Report. This report is especially important for corn and soybeans because it reports the state of the new crop, including the damage from one of the worst droughts on record. The average production estimate for corn is 11.026 billion bushels, approximately 3 billion bushels lower than the previous month. The average yield estimate is expected to be around 127 bushels per acre, with a range of 117.6 to 135 bushels per acre. Domestic ending stocks are anticipated to drop to 660 million bushels.

Soybean futures are trading 7 to 10 cents higher early morning. Quiet trade is characterizing the soy complex ahead of USDA’s WASDE Report. This report will provide insight into the state of the 2012-13 soybean crop through July. The trade is anticipating USDA to slash production output estimates and yield projections due to extreme drought conditions this summer. Yield estimates are expected to average 37.8 bushels per acre while production output is expected to average 2.8 billion bushels. Domestic ending stocks to use is expected to hit a record high of 4.1 percent.

Wheat futures are trading mixed early morning. Prices at CBOT and KCBT are trading 3/4 to 2 cents higher, while slight pressure is developing at MGE with prices 1 to 2 cents lower. Today’s WASDE report is expected to be mixed for the wheat market. Spring wheat yields are expected to good possibly boosting output, while domestic stocks are expected to be higher, at approximately 673 million bushels. However, with the flurry of recent reductions in Russia, Australia, and the Black Sea Regions, traders expect global ending to decline. The average of analysts’ expectations for world ending stocks are approximately 178.9 million tonnes.

Live cattle futures are called to open mixed this morning. Prices are anticipated to see slight pressure as late week cash trade develops. Preliminary asking prices should remain steady at $121 in the South and $190+ in the North. On the other hand, renewed strength in wholesale beef prices should lend support to futures. Market action today, is expected to be strongly influenced by USDA’s WASDE results for the grain complex.

Lean hog futures are called to open mixed this morning. Prices anticipated to open pit trade uneven, pressured by lower cash prices but supported by nearby contracts discount to the lean hog index. Traders will keep a watchful eye on grain prices after the release of the WASDE report. If production and yields estimates decline as much as analyst expect, livestock producers could be faced with record high prices for corn and soybean meal.

Cotton futures are trading mostly lower this morning. USDA’s WASDE report is scheduled to be released this morning at 7:30 am CDT and results are expected to be mixed for cotton. Many traders now expect USDA to cut production estimates due to the hot and dry summer seen in key production areas of the US, but some remain bearish about the market, considering global stocks remain fairly large. Traders are also watching India and Pakistan where the monsoon rains have been below average and production could be quite lower in those regions.