Corn futures settled higher on Thursday. The rally was attributed to technical short-covering and spillover strength from crude oil. An additional supportive factor was the weakness in the dollar index. China announced plans to buy 10 million tonnes of corn for state reserves to strengthen domestic prices. March closed 4 cents higher at $3.53 1/4 and May ended 4 cents higher at $3.62.

Soybean futures closed mixed on Thursday. The market was higher most of the session on a recovery rally from near two month lows. Gains in crude oil and weakness in the dollar were also supportive. However, front end futures failed to hold onto gains as the stock market turned lower and as forecasts continue to call for more rainfall in Argentina the next couple of days. March ended 3 cents lower at $8.84 1/2 while July was 3/4 of a cent higher at $8.91 1/2.

Wheat futures traded higher on Thursday. The market recovered from two month lows on short-covering and spillover support from crude oil. Traders were also encouraged by the weakness in the dollar index. Forecasts for more warm and dry weather in the southern Plains are also a bullish concern as moisture levels remain deficient. CBOT March closed 8 3/4 cents higher at $5.19 1/2, KCBT March was 11 3/4 cents higher at $5.58 1/4 and MGE March ended 5 3/4 cents higher at $6.25 3/4.

Cattle futures closed strongly higher on Thursday. The market bounced from technically oversold levels with some spillover support coming from other commodities. But fundamentals remain mostly bearish. Cash cattle traded $2-$3 lower yesterday compared to last week and boxed beef prices continue to fall. At midday, Choice cutouts were down 39 cents at $134.47, the lowest level since September 2, 2005. April settled $1.83 higher at $84.75 and June ended $1.45 higher at $82.53.

Lean hog futures were under pressure again on Thursday. The April contract fell to a new low as weakness in the cash market and pork cutouts pressured futures. Pork cutouts were down $1.32 on Wednesday, pushing packer margins further into the red and encouraging packers to put cash bids on the defensive. April closed 23 cents lower at $60.58 and June was 78 cents lower at $73.10.