Corn 
Corn futures are called 4 to 7 cents lower. Trade estimates for the USDA weekly export sales report ran from 400 to 650 thousand MT, with most expecting net cancellation of old crop due to rollovers. Prior week combined sales were 536,100 MT. USDA put this week at a net 637,000 MT. There were in fact cancellation/deferrals of 320,000 MT of old crop, with the marketing year ending yesterday. There will still be another week of old crop export sales reported, and China was an old crop buyer on a destination switch in this morning's report. Basis levels in some areas of the country where supplies are exceptionally tight are still running as much as 50 cents over the futures. Weekly ethanol production last week dropped to an average 888,000 bpd as plants took downtime ahead of harvest. Ethanol stocks were only 17.9 million barrels due to the reduced output. Futures were down 3 to 8 cents per bushel overnight on Globex.

Soybeans 
Soybean futures are called 9 to 12 cents lower. USDA reported weekly export sales at a net 593,800 MT, with all of the sales in new crop. Trade estimates had been from 350 to 600 thousand MT so this is a fairly strong number. Soybean stocks at select export elevators and terminals were up 411 thousand bushels from the previous week. The Corn/Soybean ratio for July 2012 is 1.85 so beans have some catching up to do to command more acres for 2012. China does not have ample reserves of soybeans that they can draw on if needed. Estimated stocks are only rated at 1-2 months of use, excluding imported beans currently sitting at the ports. Soybean basis dropped sharply yesterday, with crushers reporting difficulty selling the cash meal. Futures were down 10 1/4 to 11 1/2 cents overnight on Globex.

Wheat 
Wheat futures are expected to open the day session 10 to 12 cents lower. Trade estimates for the weekly export sales report ranged from 350 to 550 thousand MT. USDA put the actual number at 369,200 MT, with Mexico the largest single buyer. Wheat stocks at select export elevators and terminals were down 39,000 bushels from the previous week. KC protein premiums were stronger again on Wednesday, by 5 cents for wheat in the 12% to 13.4% range. Globex futures were down 7 3/4 to 12 cents.

Cattle 
Cattle futures are called 10 to 20 cents lower. The August cattle contract expired weakly yesterday. Negotiated cash cattle trade was inactive on light demand in the Southern and Northern Plains, but packer bids were rising. Boxed beef continues to move lower with Choice down $1.78 at $182.79 and Select at $174.37 down $1.70. The drought in the Southern Plains has sent cattle to feed lots ahead of the normal schedule. Cattlemen have had to sell off herds because of the drought losing genetics bred to specific regions that have taken generations to develop. Although cattle numbers are down exports are up. USDA Weekly export sales for last week were 16,900 MT.

Hogs 
Lean hog futures are called 10 to 20 cents lower this morning. The cash market got slaughtered again on Wednesday. Cash hogs in IA/MN hogs $2.48 at $85.36, WCB hogs were $2.66 lower at $85.23 and ECB hogs were $2.59 lower at $87.52. Recent cooler temps have benefited hog production increasing weights seasonally. Packers have met their needs ahead of the holiday and are backing off on bids. Saturday estimated hog slaughter is 45 to 50 thousand. The Carcass cutout value was down another $1.55 on moderate to heavy packer offerings.

Cotton 
Cotton futures are trading 60 to 70 points higher. The extent of damage to east coast cotton from hurricane Irene is unknown, but is slightly supportive. North Carolina definitely sustained some crop damage based on media reports. There is also some concern over Hurricane Katia out in the Atlantic. The Weekly Export Sales Report was a net positive 229,800 RB in the week ending August 25. Cotton output in China is expected to reach 7.48 MMT if weather conditions remain conducive to production. Estimated commercial cotton stocks in China are about 45% higher than a year ago at 834,000 MT. Demand from textile mills is thought to still be sluggish. Certificated Stocks were up from the previous day at 16,417. The Cotlook A Index was at $115.60.

By Donna Hughes
Lone Star Portfolio Advisors, Inc. was founded by Donna Hughes.  Donna began her career in the industry in 1978 after graduating High School as a member of the Chicago Mercantile Exchange’s Inspection and Delivery Department where she was responsible for scheduling and facilitating the USDA grading and delivery for various Exchange Commodities.  After 1 ½ years, she was offered a position working with George Segal, a prominent hedger in the Pork Belly market.  It was through this relationship that she was mentored and taught the hedging process by working with Mr.  Segal as well as other leaders of the Pork Industry.  In 2004, Donna moved to Texas where her skills in the industry were utilized to help individual and corporate producers with their Risk Management Goals.  Her Daily Market Commentaries are heard on the AllAgNews.com Radio Network broadcasting throughout Texas.  She also contributes to magazines and periodicals including PetroEvents and Ag Monthly.

Donna created Lone Star and implemented strategic relationships with Daniels Trading and R.J. O’Brien leveraging their services to enable Lone Star to Build Lasting Relationships Thru Information, Execution and Research.