Corn futures firmed overnight after closing higher yesterday on positioning ahead of the WASDE. The trade awaits exports sales data out this afternoon; the estimate for old crop corn is 250,000-450,000 tonnes and 300,000-500,000 tonnes for new crop. Ethanol production was reported to be 961,000 barrels/day, compared to 965,000 last week. This is a 7% increase over last year. The USDA reported the U.S. exported a record 967,529 tonnes of DDGs to China in June. The Chinese Farm Ministry is urging lower corn prices to help end users.  September corn futures lifted 2.0 cents to $3.7475/bushel early Thursday, while December rose 1.75 cents to settle at $3.85.  

The soy complex lowered overnight after a substantial rally yesterday. Export sales trade expectations for old crop beans are 0-200,000 tonnes 350,000-700,000 tonnes for new crop.  Ahead of the WASDE next Wednesday, the average trade estimate for soybean yield is 44.8 bushels and 83.6 million for harvested acres.  Weather for the remainder of August will be key to the market, particularly potential for dryness.  September soybeans lost 2 cents to $9.6075/bushel early Thursday, while September soyoil lost 0.13 cents to 29.60 cents/pound and September meal rose $.3 to $343.5/ton.  

Wheat futures gained in the overnight session after rising yesterday in part due to private estimates suggesting a lower winter wheat forecast as well as some bargain buying.  Dry weather in the Black Sea region that could stress crops may also be adding support.  Even so, weak export demand and ample U.S. and world supplies will likely limit upside potential in the near term.  The trade estimate for 2015/16 wheat export sales is 400,000-600,000 tonnes.  September CBOT wheat futures gained 8.5 cents to $5.02/bushel Wednesday, while Sep KC wheat lifted 4.75 cents to $4.8975/bushel, and September MWE firmed 1.75 cents $5.155. 

Nearby cattle futures traded higher Wednesday, extending the bounce from what appears to be a bottom of 143 reached on July 27. This is reversal of a downward trend that began in early June. Boxed beef values surged 1.73 for choice and .68 for select Wednesday suggesting further support in the near term. One analyst reported that, based on historical data, if cash cattle have hit a seasonal bottom, an average rally of 13% may be expected before reaching Q4 highs.  October live cattle gained .05 cents to 148.17 cents/pound at the close Wednesday, while February futures lost .07 cents to 149.55.  Meanwhile, September feeder cattle futures rose .20 cents to 211.02 cents/pound, while November feeders dropped 0.15 to 206.60.

Lean hogs corrected lower Wednesday after rising the past two days in what appears to be a trend higher.  However, given the easing of cash hogs, as indicated by midsession reports of cash weakness, nearby hog futures may see more pressure ahead despite increased  buyer interest.  The October contract still remains at a steep discount to the cash index.  The nearby contract has risen steadily in recent weeks after bottoming on July 13. October hog futures closed 0.42 cents lower to 66.77 cents/pound Wedesday, while February lost .40 cents to 68.30.

The cotton market weakened again early Thursday and is lower for the fourth straight day, presumably on fund positioning ahead of the WASDE next Wednesday.  Good cotton crop ratings and broader supply issues are converging to form a bearish outlook for the cotton market.  Traders await the WASDE next week to if the USDA will revise the July production forecast of 14.5 million bales.  December cotton futures lost .29 cents to 63.23 cents/pound just after dawn Thursday, while May lost 0.24 cents to 63.48.