CLOSING GRAIN COMMENTS:

Tuesday’s price-action told us a lot about the futures trade
psychology, I think, especially given the continued extreme heat following
Monday’s very bullish crop conditions report for row-crops—and the fact that
neither could give the market the boost in the overnight or morning market hours
that many expected.

This lackluster price performance I believe was due to the
corn bulls getting concerned about a sharp down-turn in the soy, and that the
corn was waiting on the beans to go higher since it has moved so much higher on
a percentage basis. It appeared to me that when the American & European
models suggested better rain chances after this week, this held-back the beans
and offset the bullish crop conditions report from Monday night. As a result,
corn was held-back too.

My mid-morning, however, beans made new highs: wheat and
corn followed quickly. Wheat seemed to garner a little extra boost from the
very strong close in French and German Futures. And corn Basis at the Gulf also
jumped 3 cents, giving the July Futures the chance to lead again.

CLOSING LIVESTOCK COMMENTS:

Except for the sharply lower trade in feeders thanks to
another 3+% gain in the grains, Tuesday’s pre-holiday trade was much more
subdued than Monday’s session—as traders likely flattened-out on their trades
heading into the 4th of July Break.

Hogs were slightly lower to slightly higher to finish
Tuesday’s trade, as supportive cash markets in some locations kept bids
underneath the markets a little more than normal. As for cattle, it too was
slightly higher—which was impressive given the 1 ½% losses in feeders; I
suspect that the live cattle strength came from shorts covering positions they
worked-into on Monday’s session.

Holiday buying demand will be a big factor when futures open
back up on Thursday morning—many are concerned that higher retail prices
coupled with a weaker economy may be hurting summer meat demand.

For More Information, Contact Mike Zuzolo At 765 471-1600 or
Online at www.globalanalytics.biz

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