Ag futures seem likely to start the week with a bullish bias

Nearby corn futures rose slightly Monday night. Yellow grain prices seemingly sustained a bit of their strength from late last week, but the main driver of the modest advance was probably powered by concurrent gains in the soybean pit. Disappointing weekend rains left larger areas of Argentine fields stressed for moisture, thereby implying diminishing bean production in the weeks ahead. The South American corn crop is essentially (un)made at this point, which explains the modest CBOT response. March corn looks set to begin the week trading 1.25 cents higher, at $7.00/bushel, whereas December slipped 0.5 cent to $5.625 in Monday night action.

Soybean futures surged in Monday night-Tuesday morning trading. Argentina was blessed with widespread rainfall over the weekend, but the regions that needed the moisture the most reportedly received the least. Moreover, while forecasts indicate chanced for intermittent rainfall over the next 10 days, the chances of a soaking event are minimal. Thus, soybean futures may continue rising during the days ahead. March beans climbed 21.0 cents to $14.455 early Tuesday morning, while March soyoil rose 0.42 cents lower, to 52.04 cents/pound, and March meal gained $8.1 to $417.5/ton.

Wheat futures were mixed to slightly higher early Tuesday morning. Strength spilling over from the soybean pit was very likely the most supportive factor, whereas weather forecasts for the Central U.S. are probably weighing upon the market. A winter storm is expected to sweep across the Great Plains starting Wednesday, with the dry winter wheat areas of Kansas and Nebraska expected to get a good blanket of snow. That could do wonders for the forthcoming crop. That may weigh upon wheat futures later in the week. March CBOT wheat futures inched 0.25 cent higher to $7.425/bushel in early Tuesday electronic trading, while March KCBT wheat gained 1.25 cents to $7.7875, and March MGE futures slipped 0.5 cent to $8.23.

Cattle futures may start the week on a firm note, since prices were rallying late last week. Moreover, calf and yearling prices moved generally higher at the Oklahoma City auction Monday. However, a sustained move is not at all assured, especially after choice beef cutout fell rather sharply last Friday. That is, if packers prove unwilling to boost their bids for fed cattle, especially if wholesale prices are declining, the Chicago market could struggle. April cattle climbed 0.67 cents to 130.45 cents/pound at their Friday (2/15) close, while August advanced 0.67 cents to 126.72. Meanwhile, March feeder cattle ended last week having surged 0.70 cents to 143.37 cents/pound, and August jumped 0.67 cents to 156.90.

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