Corn futures firmed Wednesday, several hours ahead of the WASDE release. The average estimate for world and U.S. ending stocks are 212.08 mmt and 1.768 billion bu, respectively, compared to the USDA’s 227.30 mmt and 1.760 billion in Nov. Markets will be watching the export estimate for changes after the USDA forecast in Nov 1.800 billion bushels. Factors being weighed by the trade include the Fed’s expected rate hike (likely boosting the dollar and hurting prices), larger than expected U.S. production, the WTO’s $1B ruling against U.S. meat, corn exports which lag 25% behind last year, and the new Argentine government taking office in about 24 hours. Supportive factors include the EPA’s higher RFS mandate, S. American weather, and record Chinese ethanol demand. March corn futures were 2.25 cents higher to $3.7575 early Wednesday, while May gained 1.75 cents to $3.81.

Soybean futures moved higher early Wednesday ahead of the Supply/Demand report. The average trade estimate for world soybean ending stocks came in at 82.64 million tonnes while the U.S. soybean ending stocks estimate was reported at 465 million bushels. The trade will monitor revisions to the 15/16 soybean export estimate from the USDA in Nov at 1,715 million bushels, weighing both Argentina’s potential to flood the world market and China’s tendency to outpace the USDA’s forecast for their import appetite. Respected analysts are forecasting lower Brazilian production by as many as 1-5 million tonnes. Tomorrow, Argentina’s new leaders take office, promising to reduce by 5% the soybean export tax to 30%. January soybeans were 4 cents higher to $8.8075 Wednesday  morning, while Jan soyoil lost 0.03 to 31.67 cents per pound and January meal climbed $1.6 to $277.

Wheat futures moved higher Wednesday, on the cusp of the WASDE. World and U.S. ending stocks estimates are at 226.43 mmt and .918 billion bu, respectively. This compares to the USDA’s Nov forecasts for world and U.S. wheat at 227.3 mmt and 911 million bushels. The USDA forecast wheat exports at 850 million bushels in Oct, then revised lower in Nov to 800 million and the expectation is that this will fall lower in today’s report, lifting stocks and pushing prices lower. Wheat has proven unable to sustain rallies above contract lows as wheat exports this year are the lowest since 1972. Crude oil breaking below 38 dollars has also hindered feedgrain prices after OPEC’s decision to keep its production ceiling at around 30 million barrels a day, prolonging the glut in world oil. March CBOT wheat futures lifted 4.0 cents to $4.855/bushel Wednesday, while Mar KC wheat gained 3.75 cents to $4.7625, and March MWE climbed 2.25 cents to $5.075.              

Nearby cattle future were still in search of a bottom Tuesday, sharply lower for the second day, despite higher cutout values. Boxed beef cutouts were higher with choice up 1.84 to 204.71 and select up 0.92 to 191.28. Cattle slaughter for the week was at 224,000 head, compared to 218,000 last week and 225,000 a year ago. Last week’s slaughter was at 560,000 head, 0.6% lower than a year ago. Beef demand has a small upside window between Thanksgiving and Christmas before weakening into the new year. February live cattle lost 1.97 cents to 127.07 cents/pound at the close Tuesday, while April futures lost 2.07 to 128.05. January feeder cattle plunged 4.50 cents lower to 153.85 cents/pound and March feeders declined 4.22 cents to 151.47.

Nearby lean hogs firmed Tuesday and the deferred months weakened. Country hog prices moved 0.68 lower to 51.26 and the lean hog index fell .08 to 56.22. While the opportunity for pork to gain holiday meat market share still exists, large supplies have so far outweighed even the record decrease in pork stocks from the October cold storage report. Selling psychology may continue to have a near-term impact on the trade after the World Trade Organization (WTO) granted Canada and Mexico more than $1 billion in retaliatory tariffs against the U.S. following a seven-year dispute over country-of-origin-labeling (COOL). Hog slaughter for the week was at 876,000 head, compared to 876,000 last week and 861,000 a year ago. February hog futures moved 0.27 cents higher to 58.37  cents/pound, while the April contract gained 0.15 to 62.35 cents/pound.              

ICE cotton futures were neutral-firmer Wednesday morning ahead of the WASDE report. The trade will look for revisions to cotton exports/domestic use. The Nov WASDE estimated 2015/16 domestic use at 3.7 million bales and exports at 10.2 million bales Last week’s export sales report showed sales of 287,100 bales of upland cotton and 2,400 bales of Pima cotton sold. Analysts expect there may be reductions in world consumption as well as lower production forecasts for the U.S., China, and Pakistan while Australia and Brazil may see higher production estimates. Mar cotton was 0.04 higher at 64.48 cents/pound early Wednesday, while May cotton was neutral at 65.21.