Corn prices are trading modestly higher midday. The market is taking a breather after Tuesday’s rally on news that dry conditions in South America are worsening. Weather forecasts and reports coming in show dry conditions quite severe expected to continue in both Argentina and parts of Brazil, which has rallied the corn futures market and will keep prices strong. The nearby contract blew through the resistance at $6.26 and may now challenge the next technical resistance at $6.43. The lower stock market is weighing on corn. March is 2 1/4 cents higher at $6.35 1/2 and May is 2 1/4 cents higher at $6.43 1/2.
Soybean futures are trading lower at midsession. Profit-taking from Tuesday’s rally is weighing on futures this morning. Adding pressure are the stronger dollar and the pullback in the stock market. The weakness is also blamed on technical factors. While there is concern about the soybean crops in the Southern Hemisphere, the problems have not had much of an impact on actual demand for U.S. soybeans yet. Soybean futures prices are considered to be oversold, but prices will probably rebound if weather conditions in Brazil and Argentina don’t improve soon. January is 8 1/4 cents lower at $11.91 1/2 and March is 8 1/2 cents lower at $12.01.
Wheat futures are trading modestly higher at midday. Wheat has rallied to a 7-week high, moving above its 100-day moving average, which is positive technically. However, there is little new fundamental news to move the market, and wheat is keeping a close eye on corn as more wheat has been priced into feed rations. In general, weather conditions are relatively good for 2012 wheat production with increasing snow cover in Ukraine. Longer term wheat prices will fall if it looks like we are headed for big crops in key wheat producing countries, but for right now the price trend is up. CBOT March is 2 3/4 cents higher at $6.47 1/2, KCBT March is 1 3/4 cents higher at $6.97 1/2 and MGE March is 1 1/4 cents higher at $8.63 3/4.
Live cattle futures prices are trading mixed at midday. Nearby prices have pulled back following last week’s short covering rally. Adding pressure is the light mid-holiday demand and the shortened work week ahead of the New Year making demand hard to gauge. Showlists for this week indicate more cattle are available to the cash market which may tend to temper any significant increase in cash prices, but some buyers have low inventories, especially in the South where trade volume last week was very low. However, no significant cash trade activity is expected before Thursday. February is 20 cents lower at $123.00 and April is 5 cents higher at $126.60.