Early Call On Chicago

12/12/11 -- The overnight markets continue to drift lower with beans down around 6 cents, corn 6-7 cents weaker and wheat down 4-6 cents. Crude is a dollar or so lower as the markets digest Friday's news out of Europe. Or should that be "Europes" as Sarkozy now says that there are two of them.

How much real substance is behind Friday's "deal" and what it changes for the crisis that is ongoing now is what the market is pondering. It doesn't seem to be liking the conclusions that it's coming up with as the euro is back under pressure again today.

Sarkozy says that the loss of France’s AAA credit rating wouldn’t be "insurmountable," according to the Le Monde newspaper. That's lucky, because that's exactly what is likely to happen. Sarkozy's potential rival in next spring's elections, Francois Hollande, is already saying that he'd like to renegotiate Friday's "deal" before the ink's dry.

Fresh fundamental grain news is limited. Parts of Brazil are set to remain dry, but there's some decent moisture in the forecast this week for many other areas.

Australia's bumper wheat harvest continues to be hampered by rain. Another abundant year of feed wheat coming out of their is seen as bearish for US corn demand going into 2012.

Brazil is expected to increase corn plantings 11% for the 2012 harvest to a record 8.77 million hectares.

US wheat remains too expensive to compete with abundant supplies priced more keenly elsewhere around the world. The main thing supporting CBOT wheat right now is the sizable short that funds have already amassed and lack of producer selling.

Funds have also now turned bearish on beans and are reducing their corn length on an almost daily basis.

Early calls for this afternoon's CBOT session: beans and corn 5-7 cents lower, wheat down 3-5 cents.