Corn futures are called 4 to 5 cents lower. Overnight trade at 6:45 am CT was 3 3/4 to 5 cents lower. Strength in the dollar and weakness in crude oil and gold overnight are weighing on commodity markets. Export demand has slowed, but demand remains strong for corn used in ethanol production. Underlying support will come from USDA’s smaller crop production forecasts and tight ending stocks estimate released on Tuesday morning. The stocks to use estimate fell to 6.2%, the lowest since 1995-96.
Soybean futures are called 6 to 7 cents lower. Overnight trade at 6:45 am CT was 6 1/4 to 7 cents lower. Light profit-taking is expected to weigh on futures following the strong gains on Tuesday. Fundamentals remain supportive as USDA lowered its production and ending stocks estimates. Export demand remains strong and USDA raised the export forecast. Strength in the dollar and weakness in crude oil and gold overnight are weighing on commodity markets.
Wheat futures are called 4 to 6 cents lower. Overnight trade at 6:45 am CT was 5 3/4 to 6 1/4 cents lower at the CBOT, 4 to 4 1/2 cents lower at the KCBT and 1 3/4 to 2 cents lower at the MGE. Strength in the dollar and spillover pressure from corn and soybeans will weigh on the market. USDA’s global ending stocks estimate has tightened from last year, but the stocks to use ratio estimate is comfortable at 26%. Underlying support will come from poor winter wheat condition ratings as dry weather has hurt the crop in the Plains and Midwest.
Cattle futures are called steady to mixed as traders wait for the cash market to develop. Cash trade is currently expected to be steady to $1 lower this week compared to the $98 trade last week. Boxed beef prices have been mixed this week, but choice cutouts were down 74 cents on Tuesday. While corn prices have eased yesterday and overnight, bullish concerns for feed prices could help support deeper deferred cattle futures.
Lean hog futures are called higher on the open. Pork cutouts were up $1.01 on Tuesday and national average cash prices were firm. Packer margins remain solid and ideas of another big Saturday slaughter should help support cash prices. But gains will be limited by the weekly cold storage report showing increasing supplies of pork in storage.
Cotton futures are trading strongly higher again overnight. The rally in China’s cotton futures to new highs and bullish revisions by USDA on Tuesday morning continue to support cotton trade. USDA lowered the crop production estimate and put ending stocks at the low level of 2.2 million bales. At 6:30 am CT, December cotton was 407 points higher at 155.30 and March was 288 points higher at 149.99 cents.