Corn futures closed strongly higher on Thursday. Fund and commercial buying was triggered largely by prospects for even larger than expected corn-based ethanol production over the next year or two. In addition, it seems traders were anxious to cover shorts or position long ahead of the USDA reports on Friday. March ended 16 1/4 cents higher at $3.76 1/2 and December was 14 1/2 cents higher at $3.74 1/2.

Soybean futures closed higher on Thursday. Commercial buying and strong support from the corn market helped rally the market. However, gains were held in check by generally bearish fundamentals and caution ahead of the USDA reports due out on Friday morning. March closed 9 1/2 cents higher at $6.74 1/4 and November was 10 1/2 cents higher at $7.23 1/4.

Wheat futures ended solidly higher on Thursday. The surging corn market helped push prices higher as shorts were covering positions to protect profits. According to some reports most of the index fund rebalancing has already been done. CBOT Mar was 7 cents higher at $4.56 1/2, KCBT March climbed 9 cents to close at $4.81 1/4 while MGE March closed 11 3/4 cents higher at $4.82.

Cattle futures closed mostly lower on Thursday. Futures fell today on profit-taking on the recent rally. The lack of cash market activity contributed to the setback. News that the U.S. and Japan had failed to reach an agreement to allow additional exports of U.S. beef to Japan was slightly negative. February fell 35 points to close at $93.60. The April contract was 42 points lower at $94.35. January feeder cattle fell 60 points to close at $97.57.

Lean hog futures struggled to a mostly higher close in light trading on Thursday. Most of the trading was driven by technicals. Cash hog prices were steady to lower providing little support to futures. Sharply higher corn prices pushed deferred hog futures down early, but the market rebounded by the close. February fell 5 cents and closed at $60.50, while all other contracts posted small gains. June hogs ended the day up 30 cents at $72.65.