Corn                                                    Estimated Fund Position
Short Term: Up                                Net Long Futures and Options: -8151
Long Term: Down                            Change: -14000
Overnight Trade: K +2 Z +1 @7:30 AM

Old crop corn had a bit of a meltdown yesterday partly due to profit taking on bull spreads, which is related to fears of planting delays, and partly due to liquidation in the May contract ahead of option expiration and first notice. A poor close today in the May contract would definitely have traders looking for a retest of the lows, so the bulls will be on edge today. The amount of moisture in the extended forecasts will dictate the direction of the new crop contracts and planting delays will probably favor the September contract more than the December.

Wheat                                               Estimated Fund Position
Short Term: Up                               Net Long Futures and Options: -48371
Long Term: Down                          Change: +1000
Overnight Trade: Chicago: K -3 KC: K -4 @7:30 AM

It was cold again in a large part of the HRW Belt, but I don’t think many people care. They might care when the crop condition ratings come out on Monday, but for the moment the moisture totals in the eastern part of the HRW Belt seem a lot more important. The May KW did close above the 40-day moving average yesterday, which is a minor moral victory for the bulls, but what will really need to see is a close above $7.50 going into the weekend.

Soybeans                                        Estimated Fund Position
Short Term: Up                              Net Long Futures and Options: 44626
Long Term:Up                                Change: +5000
Overnight Trade: K -1 X-3 @7:30 AM

May soybeans closed above the 50-day moving average yesterday and we continue to see bull spreading in the market. Look for the May contract to head for $14.85. USDA will almost certainly have to raise the export estimate in the May supply and demand report and if ending stocks don’t shrink it is because they lowered residual usage to a negative number. Demand for old crop soybeans is obviously strong, but it will be tough going for the November contract. Talk of corn planting delays has traders thinking about increased soybean acres, which will keep a lid on that market.

Live Cattle
Short Term: Down
Long Term: Down
Opening Calls: 10-20 Lower

Live cattle futures closed mostly lower on Thursday and are continuing a softer bias in overnight trade. Cash trade continues to be relatively untested for the week. The wide range of expectations on the placement number in this afternoon’s report could limit cash until after the report is released. The June contract remains about .50 above week ago settlement price. Outside markets should be supportive, with the Dollar softer and equities rising.

Feeder Cattle
Short Term: Down
Long Term: Down
Opening Call: 40-80 Lower

Feeder cattle futures closed sharply lower on Thursday, with most contracts testing contract lows or nearing those levels. Corn is modestly firmer in overnight trade, with expectations for this afternoon’s report mostly benign. Cash index levels continue to plummet, with Thursdays’ number down 3.32 from last Friday’s release. Overnight pressure has picked up where we left off on Thursday, with losses approaching 100 points in most contract months.