Corn 
Corn futures are trading 15 to 19 cents higher this morning after seeing a little profit taking overnight on Globex. The advanced stage of the corn crop this year makes the heat and limited rain fall more of a threat to production than we might normally expect in late June. Analysts on average expect the USDA on Friday morning to put corn ending stocks as of June 1st at 3.174 billion bushels with average estimates for 2012/13 planted acres at 95.962 million acres. Yield estimates will not be made until July 11. Friday will also be first notice day for July futures deliveries. Basis has weakened enough to make deliveries more possible than it appeared two weeks ago. Preliminary open interest for Tuesday shows heavy short covering, with the OI down 17,655 contracts. Open interest in the July was still 86,297 contracts, but dropped 26% in one day. Chinese futures were 9 cents lower at Dalian.

Soybeans 
Soybeans are currently 14 to 17 cents higher than the Tuesday close. Hot and dry weather in the majority of the growing area is still a factor for the developing crop. Traders are positioning ahead of the USDA reports on Friday, but mostly focused on weather. There was some light long liquidation on Tuesday, with preliminary OI down 1,961 contracts. Analysts on average expect to see June 1 soybean ending stocks at .635 billion bushels (another survey says .640) with acreage at 75.575 million. Oil World is calling for an increase in China imports of soybeans to 57.9 MMT up 5.6 MMT from last year and up 1 MMT from Oil World's May estimate. Soybean stocks at select export elevators and terminals were down 467,000 bushels from the previous week. Chinese futures were 5 cents lower.

Wheat 
Wheat futures are trading a penny lower to a penny higher in Chicago. Wheat futures are at the high end of the 2012 trading range. Analysts on average expect the USDA to come in at 56.851 million acres for all wheat plantings on Friday morning, with 12.656 for spring wheat and 2.299 for durum. Analysts expect the USDA quarterly grain stocks report to show wheat stocks at 723 million bushels, with a survey range of 705 to 748 million. Wheat stocks at select export elevators and terminals were up 2.881 million bushels from the previous week at 192.6 million. India sold a reported 200,000 MT of wheat into the Middle East. The rise in global prices during June has made Indian wheat more competitive, and they have some large carryover supplies.

Cattle 
Cattle futures are currently trading 10 higher to 10 lower. Tuesday's estimated slaughter was 129,000 down 2,000 from a year ago. Cattle sold last week for $116 in the live and $187 in the dressed about $3 lower than the previous week. Cash trade was inactive on very light interest in all major feeding regions Tuesday. The mid-week July 4th holiday is complicating packer procurement for next week. Wholesale prices ended higher yesterday, supporting cash trade ideas for today. Choice was up $1.31 and Select was up $0.19. Feeder cattle ended sharply lower on the second day of down gaps with corn prices rising sharply. Cattle crush margins, a measure of potential profitability for feedlots, are sharply negative. Feeder steers and heifers at the Oklahoma City auction were down $2 to $4 from last week in part because of higher corn and the deteriorating condition of pastures.

Hogs 
Lean Hog futures are 10 to 20 cents lower this morning. The pork cutout was down $1.83 Tuesday on 83.75 loads. The CME Lean Hog Index was 102.01 as of June 22nd about $10 higher than the futures with which they have to converge in a couple weeks. IA/MN hogs were down $1.24 on Tuesday, the WCB was down $1.40 and the ECB down $1.04 this afternoon. The spread between July and August hogs settled at $4.65 in favor of the July this afternoon.

Cotton 
Cotton futures are trading 10 to 50 higher with the exception of the almost non-existent July contract, which is showing no trade. Certificated stocks were up slightly from the previous day at 119,816 RB. There were 76 delivery notices against July futures last night, the first deliveries against the contract. Dreyfus stopped most of them for its house account. The Cotlook A index was 1.00 higher at 82.30. The iffy world economic outlook is keeping a lid on cotton prices. The USDA will release the cotton planted acreage report on Friday.

There is substantial risk of loss to futures and options trading. Past performance is not indicative of future results.

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.