Corn futures are called 7 to 8 cents higher. Overnight trade at 6:45 am CT was 7 1/4 to 7 1/2 cents higher. Follow-through buying is supporting the market following the bullish USDA supply/demand revisions yesterday. USDA lowered the production estimate for 2010 and pushed the ending stocks to the very tight level of 745 million bushels. The stocks-to-use ratio of 5.5% is extremely tight. Outside markets and commercial selling following the recent rally in prices will limit gains.


 


Soybean futures are called 3 to 4 cents higher. Overnight trade at 6:45 am CT was 3 1/4 to 4 1/4 cents higher. The market was choppy overnight, but has pulled slightly higher on the bullish USDA revisions yesterday and spillover support from corn. As with corn, USDA lowered ending stocks to the very tight level of only 140 million bushels. The stocks-to-use ratio is only 4.2%. Gains are expected to be limited by some profit-taking from the strong rally yesterday, outside markets and the weekly export sales report which could indicate slowing demand.


 


Wheat futures are called 4 to 7 cents higher. Overnight trade at 6:45 am CT was 4 1/2 cents higher at the CBOT, 5 1/2 cents higher at the KCBT and 7 cents higher at the KCBT. Spillover support from corn and some optimism for export demand following USDA’s Supply/Demand report are expected to support futures. USDA raised their export forecast by 50 million bushels yesterday and lowered the ending stocks estimate from last month. Export sales need to be above 16 million bushels and shipments around 32 million bushels to remain on pace with USDA’s export forecast.


 


Cattle futures are called higher on the open. Futures have rallied to new highs, but bullish cash fundamentals and rising corn prices will be supportive. Choice beef prices were up $1.17 and select cuts were $2.46 higher on Wednesday. Cash trade is expected to be up $1-$2 from last week, but so far this week packers have been hesitant to raise bids.


 


Lean hog futures are expected to open higher. Futures are at or near contract highs amid bullish cash fundamentals. Pork cutouts were up $1.00 yesterday and market ready hog supplies are tightening. Coupled with the wintery weather in the Midwest that is disrupting marketings and cash prices should be higher today. Further strength in corn prices is also bullish as it will likely limit pork production.


 

Cotton futures are trading higher this morning. The cotton market was pulled higher yesterday by the bullish momentum in the grains complex. USDA’s Supply/Demand report was near trade expectations, but it did reinforce the expected tight ending stocks situation. At 6:30 am CT, March was 104 points higher at 149.02 cents.