Corn futures are called 10 to 15 cents lower. The USDA Supply/Demand report was bearish for corn. Old-crop ending stocks were estimated at 730 million bushels, up 55 million from last month while traders were looking for a decline. The first official 2011/12 projection for ending stocks was 900 million bushels, nearly 100 million bushels above trade expectations. USDA is projecting a record large corn crop of 13.5 billion bushels, but yield was 3 bushels per acre lower than earlier expected due to the slow pace of planting progress through early May. Stocks are expected to remain historically tight. The stocks-to-use ratio is projected to be 5.4% in 2010/11 and 6.7% in 2011/12.


Soybean futures are called 5 cents lower. The Supply/Demand report was neutral for soybeans, but weakness in corn could pull prices lower. USDA raised the old-crop ending stocks estimate to 170 million bushels from 140 million last month due to reduced exports. However, the first official projection for 2011/12 ending stocks was only 160 million bushels compared to trade ideas of closer to 170 million bushels. Soybean production is projected at 3.285 billion bushels, down 44 million from the 2010 crop mostly due to lower harvested area. Soybean yields are projected at a trend level of 43.4 bushels per acre, down 0.1 bushels from 2010.


Wheat futures are called 5 cents lower to 5 cents higher. USDA’s wheat production number released this morning was near trade expectations. Winter wheat production was estimated at 1.424 billion compared to trade expectations of 1.395 billion. However, continued poor weather in the southern and western Plains could cause traders to discount the number. The all-wheat production number of 2.043 billion bushels was right on pre-report trade expectations. Old-crop ending stocks were left unchanged at 839 million bushels and ending stocks in 2011/12 are expected to decline to 702 million bushels. World wheat numbers were supportive as USDA is projecting a decline in ending stocks for the 2011/12 marketing year.


Cattle futures are called higher on the open. Strong gains in boxed beef prices and ideas that cash trade could stabilize this week will be supportive. Choice cutouts were up $1.93 and select cuts were $1.23. The improved beef prices indicate an uptick in seasonal demand and short-bought packers are in need of supplies. Declining slaughter weights indicate feedlots are becoming more current.


Lean hog futures are called higher this morning. Cash prices have stabilized early this week and pork cutouts were up 89 cents on Tuesday. Much of the premium in summer month futures has eroded. If demand for pork can improve seasonally and market ready hog numbers continue to tighten, cash prices should work higher.


Cotton futures are trading lower this morning. USDA raised their old-crop ending stocks estimate to 1.75 million bales compared to 1.60 million last month. The first official estimate for 2011/12 ending stocks was 2.50 million bales as production is projected to be near last year, but exports to be down 2 million bales. At 8:00 am CT, July cotton was 36 points lower and December was 216 points lower.