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Wheat futures softened as the day progressed and futures ultimately ended near session lows with Chicago and Kansas City wheat 20+ cents lower and Minneapolis Wheat posting losses in the teens. USDA delivered a Supply & Demand Report that squarely favored market Bears Tuesday. The initial negative reaction to the report triggered technical selling as futures posted a downside breakout of the market’s long-standing choppy trading range.

Corn futures were choppy Tuesday but favored a weaker tone and ended 1.75 to 9 cents lower amid Bull spreading. While USDA left its MY 2012-13 Corn carryover projection unchanged from last month at 647-M bu. at a time when traders expected a slight increase, traders’ reaction to the data was limited. The reason is largely that the markets are in the “Holiday Doldrums” and there’s little fresh news to excite the Bulls.

Soybean futures initially reacted positively to USDA’s report data, but buying interest faded and futures spent the rest of the day under pressure. Futures closed 2.75 to 13 lower, with Y 2013-crop contracts leading losses. USDA cut its MY 2012-13 Soybean ending stocks projection more than anticipated this morning, but that failed to spark sustained buying interest. Instead, heavy spillover from the Wheat market weighed on Soybean futures.

December lean Hog futures finished 5 cents lower, while deferred contracts were 22.50 to 80 cents higher. Most contracts finished near session highs. A strong rally in Cattle futures and supportive outside markets helped encourage Short-covering in deferred lean Hog futures today following recent sharp price pressure. But pressure on the cash Hog market limited the Northside to corrective buying. The Northside will remain limited unless the cash market starts to strengthen.

Live Cattle futures were lifted by technical buying and unexpected strength in the boxed Beef market. Futures ended 80 cents to 1.675 higher. Early support in the Cattle pit came from technical buying as traders covered short positions. And gains were extended by strength in the Beef market. Choice values rose 2.27 this morning and Select was up 1.51 on solid movement.

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