Drought conditions continue to pressure corn market

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Corn futures are trading 16 to 23 cents higher midmorning. Corn futures are up as the Midwest continues to experience drought like conditions. Lack of rain during the critical stage of pollination has traders concerned about yield potentials for this year’s crop. USDA is set to release it crop progress report this afternoon. The trade is expecting to see further reductions in corn’s condition rating today.

Soybean futures are trading 14 cents higher midmorning. The USDA has reported exports sales of 1.19 million tonnes of soybeans to an unknown buyer for the 2012/13 marketing year. Weather worries across the Midwest and tightening supplies are also lifting prices at close to midday. Lack of rain and extended dry conditions over key production regions are expected to lead to further reductions in soybean crop condition ratings.

Wheat futures are trading 1 to 11 cents higher midmorning. There’s not much fresh news concerning the wheat market. Currently, wheat prices are being pulled higher by strength in the corn and soybean markets. Lower wheat production estimates in the Black Sea region and the expectation of tighter global wheat stocks are pushing prices higher also. However, the higher dollar index may will keep prices in check.

Cattle futures are trading lower midmorning. The market opened lower on sharp declines in beef prices. Beef prices tanked last week with both choice and select down $1.46 and $2.24 respectively. Lackluster trade in the cash market last week is also weighing on prices. Trade is expected to be choppy as traders position themselves ahead to the midweek holiday.

Lean hog futures are trading higher midmorning. Market prices are currently trading higher after a neutral to slightly bullish Hogs and Pigs report. The report indicated market hogs and breeding herd numbers up only 1%, which were within trade expectations. Cash market prices are expected to be steady lower, possibly limiting market gains.



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