Corn                                       Estimated Fund Position
Short Term: Up                   Net Long Futures and Options: -17763
Long Term: Up                    Change: -6000
Overnight Trade: N +2 Z -2 @7:30 AM

Bull spreading was active again overnight. The July contract is creeping higher and the December is creeping lower. There are a few more hours to make final preparations for the Quarterly Stocks report and the Planted Acreage report, but it is anybody’s guess what USDA will come up with for a stocks estimate and there is a pretty wide range of guesses for acreage as well. Regardless of the report numbers it is likely that by early next week traders will be back to focusing on tight old crop supplies and the weather forecasts.

Wheat                                   Estimated Fund Position
Short Term: Down              Net Long Futures and Options: -66594
Long Term: Down               Change: -1000
Overnight Trade: Chicago: N +5 KC: N +5 @7:30 AM

The wheat market continues to slip. The September KW hasn’t fallen below $7.00 yet, but it is working on it. The wheat numbers today will be a non-event, so it will take something very bullish in the corn numbers to turn the wheat around. Otherwise traders are going to have one eye on the December corn and one eye on the export figures. Right now $7.00 is holding as support, but I would look for the next downside target to be $6.80.

Soybeans                               Estimated Fund Position
Short Term: Up                     Net Long Futures and Options: 93692
Long Term:Up                       Change: -2500
Overnight Trade: N +3 X +1 @7:30 AM

We have more bull spreading in the soybeans as well. The $3.00 level looks like a good upside target for the July - November spread. Barring something negative from USDA today the July contract will make a new high for the move very soon, but at the same time there isn’t much supporting the November contract. Plan on a wild day.

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

Live cattle futures closed moderately higher in all but the expiring spot month on Thursday. Overnight activity has been volatile, with sharply lower trade when we hit the pillow, followed by a recovery to near unchanged as we write. The cash trade remains untested, with bids of $117-$118 while feedlots remain firm with asking prices of $122 in the south. Look for cash to wait until late to develop unless it is higher. Cutout values firmed on Thursday, while weight reports climbed seasonally higher.

Feeder Cattle
Short Term: Up
Long Term: Up
Opening Call: Mixed

Feeder cattle futures finished moderately to sharply higher on Thursday, showing little fear heading into this mornings’ 11 am grain report. Overnight became another story, with sell off of nearly 1.50 developing in early evening. The recovery was every bit as dramatic, with current prices trading modestly higher in all months. Thin trade and nerves ahead of the grain report could keep the market on edge into midday. Technical indicators will have buyers looking for opportunities on breaks.