Corn                                       Estimated Fund Position
Short Term: Up                   Net Long Futures and Options: -22227
Long Term: Down              Change: -12000
Overnight Trade: N Unch Z -1 @7:30 AM

The corn saw a small recovery bounce early in the overnight session thanks to the slower than expected planting progress figure, which came in at record low of 12%. However, the gains didn’t last long and traders are really more interested in the forecasts, which still have windows of opportunity for planting. Yesterday’s gap lower looks bearish on the charts and follow through to the downside is likely. Bull spreading is also likely as hedgers and speculators alike will be picking on the new crop contracts.

Wheat                                      Estimated Fund Position
Short Term: Up                      Net Long Futures and Options: -45393
Long Term:Up                        Change: -4000
Overnight Trade: Chicago: N +3 KC: N +4 @7:30 AM

The wheat was slightly higher overnight thanks to the corn market not falling apart. Crop condition ratings were down again with the US numbers at 32% Good to Excellent and 39% Poor to Very Poor. The HRW crop is in bad shape, but it is hard to find anyone who cares, especially when the corn is trading lower. As usual this market needs fresh demand it we are going to see gains. The 40 and 50-day moving averages are near $7.53 in the July KW. That has to hold in order to avoid a move down to $7.00.

Soybeans                                   Estimated Fund Position
Short Term: Down                    Net Long Futures and Options: 47171
Long Term: Down                     Change: -5000
Overnight Trade: N +6 X +5 @7:30 AM

The soybeans are in consolidation mode. Planting progress was only 2% thanks to the poor corn planting progress, which is supportive to the August and September contracts because without early planted soybeans it will be hard to bridge the gap from old crop to new crop. For the new crop contracts the big question is how many, if any, acres of corn will be shifted to the soybeans? That question will be partially answered on Friday, which makes that report a definite market mover.

Live Cattle
Short Term: Down
Long Term: Down
Opening Calls: Mixed

Live cattle futures closed moderately lower on Monday, after establishing moderate gains in the first half of trade for the day. The daily reversal in spite of last weeks’ higher cash trade and the already sharp discount to cash has us and others scratching their heads. Technically the market looks weak, with open interest rising moderately on Monday’s selloff. Fundamentally the market appears to be well supported, with weights falling and show lists shrinking. Overnight trade is narrowly mixed.

Feeder Cattle
Short Term: Down
Long Term: Down
Opening Call: 20-40 Lower

Feeder cattle futures closed modestly lower on Monday in spite of sharply lower corn values. The weakness was certainly led by the reversal in the fat futures. The weakest signal for feeders may have been the lack of rally before the break in live cattle. The inability to post triple digit gain in the face of 20 cent losses in corn is telling. Overnight feeders are off .30-.65, while corn trades narrowly mixed.