Outside markets support commodities

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Corn futures are trading solidly higher at midday. The market is being supported by a rally in equities and crude oil while the dollar has turned strong lower. Hopes that European leaders are close to a plan to deal with the debt crisis has led to the rally in financial markets. Some buying interest could also be attributed to commercial buying. South Korea bought U.S. corn in a tender overnight and rumors are that China has been in the market. Corn harvest last week increased to 15%, slightly below the ten-year average of 16%. December is 12 cents higher at $6.60 and March is 12 1/4 cents higher at $6.73 1/2.

Soybean futures are higher at midsession. Futures are rebounding from technically oversold conditions on spillover strength from outside markets. The stock market and crude oil are up sharply while the dollar is lower thanks to easing concerns about European debt problems. Leaders in Europe are working on measures to deal with current problems. Soybean harvest was estimated to only be 5% complete as of Sunday compared to the ten year average of 12% and the 15% harvested at this time last year. November is 11 1/2 cents higher at $12.71 1/4 and January is 11 1/4 cents higher at $12.82 1/2.   

Wheat futures are trading higher at midday. Outside markets have triggered the recovery rally in commodity markets. There is optimism this morning that European leaders will take the necessary action to resolve the debt crisis. Dry weather in the Plains remains a supportive factor. Winter wheat planting progress increased to 26% last week, up from 14% a week ago. While planting is moving ahead, it’s trailing below the ten-year average at 36% as it appears some are waiting for rain before planting HRW wheat. CBOT December is 15 3/4 cents higher at $6.64, KCBT December is 12 1/2 cents higher at $7.56 1/2 and MGE December is 10 cents higher at $8.80.     

Cattle futures are trading higher at midday. Continued support from the bullish Cattle on Feed report last week, firm boxed beef prices on Monday and ideas of higher cash trade this week are supporting futures trade. Outside markets are helping to extend gains as equity markets are strongly higher while the dollar index is lower. October is 80 cents higher at $120.53 and December is 93 cents higher at $120.65.

Lean hog futures are higher at midsession. The market is being supported by short-covering and outside markets. The stock market is up sharply today, which is a positive indicator for domestic demand. Meanwhile weakness in the dollar could help spur additional export demand. Traders are positioning ahead of USDA’s Quarterly Hogs and Pigs report due out on Thursday afternoon. October is 83 cents higher at $89.33 and December is $1.45 higher at $84.45.



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