The grain and oilseed markets firmed to start the week with the market expecting the government will reduce supply in the Supply/Demand report to be released by the USDA at 11:00 am (CDT) Wednesday. Corn futures ended up 7 cents last Friday for the week; a turnaround after declining for three straight weeks. The trade also expects that crops could see a lower condition rating today, September, in part due to crop maturity and dryness in some areas.  The crop progress report is due out today at 3:00 pm.  September corn futures firmed 4 cents to $3.7675/bushel early Monday, while December was up 3.75 cents to $3.875.               

The soy complex started the week mostly higher after also surging last Friday on pre-WASDE bullishness and positioning. The trade expects the USDA will lower soybean supply on Wednesday at 11:00 am (CDT), the questions remain: by how much? Soybeans futures lifted early this morning to reach two-week highs.  The 6 to 10 day weather forecast now shows a combination of below average rainfall and above average temps for the Midwest which may also add support this week. The CNGOIC (Chinese National Grains and Oils Information Center) think-tank estimates China will import 76 million tonnes of soybeans this year, up 8% from the previous year and 2 million tonnes higher than the USDA forecast. September soybeans gained 7.5 cents to $9.8325/bushel early  Monday, while September soyoil fell .02 cents to 30.11 cents/pound and September meal gained $3.8 to $348.1/ton.              

Ample supplies and reported near-record yields in the spring wheat harvest have not kept wheat futures from rising to start the week. Some pockets of dryness in EU as well as some spillover bullishness from corn and beans could be lending support. Spring wheat conditions seem to be coming along nicely with a 70% good to excellent rating last week, compared to 71% last week and 70% a year ago. Harvest was 8% completed last week, compared to the 11% five-year average. Winter wheat harvest was at 93% complete last week and should be close to done this week. September CBOT wheat futures gained 1.75 cents to $5.1225/bushel early Monday, while Sep KC wheat gained 2 cents to $4.95/bushel, and September MWE firmed 3 cents $5.23.                

Live cattle settled lower Friday, despite what appears to be a reversal higher that occurred on July 27 when nearby futures hit 143 cents/pound. While the 100-day moving average is still higher than the nearby contract by 4 cents, pre-holiday demand is expected to strengthen and, as one report suggests, historical data shows an average rise of prices during fall, assuming a bottom was reached, of 13% before topping in the fourth quarter. If this proves true this year, cattle may reach 161 cents or higher. October live cattle lost .45 cents to 148.52 cents/pound at the close Friday, while February futures rose .60 cents to 149.45. Meanwhile, September feeder cattle futures dropped 1.35 cents to 210.57 cents/pound, while November feeders lost 1.55 to 206.12.

Lean hogs corrected for the third straight day Friday, despite steady to firmer cash and pork values. One factor that may explain this divergence could be the expectation of surging supply in the next week or so that could boost hog slaughter numbers, thereby putting pressure on the cash market. The October contract still remains at a steep discount to the cash index. The nearby contract reversed last week after rising steadily in recent weeks. October hog futures closed 0.10 cents lower to 64.12 cents/pound Friday, while February lost 0.30 cents to 66.20.              

The cotton market weakened again early Monday and is lower for the sixth straight day and also the sixth consecutive week down as funds appear to be selling ahead of the WASDE next Wednesday, on the basis of a great outlook for the U.S crop on top of already ample supplies. Good cotton crop ratings and broader supply issues are converging to form a bearish outlook for the cotton market. Traders await the WASDE release this Wednesday to see if the USDA will revise the July production forecast of 14.5 million bales. December cotton futures lost 0.58 cents to 61.79cents/pound Friday, while May lost 0.51 cents to 62.39.