Grain markets were higher for the week on a surge of fund buying. In wheat, fundamentals remain negative but investor demand has been very strong as funds look to establish positions before they slow down their trading during the holidays.

Corn was little changed despite seeing investor demand there as well, but the progressing harvest and farmer selling is keeping the rally in check.

Some regions of the Midwest are seeing high vomitoxin levels in corn this year, caused by the excessive rains, which is stifling demand for corn as livestock are unable to consume large quantities of the toxins. The soy complex also surged higher, moving into new highs on continued very strong demand for soybeans, particularly from China. Soymeal has also caught a major updraft on a switch by pork and poultry producers from feeding corn to feeding soymeal in order to avoid the high vomitoxin levels. In addition, both corn and soybean oil are supported by foreign countries’ increased usage of biofuels.

The cattle complex was slightly lower on follow through selling from the previous week’s sharp drop. Cash markets are weakening as we head into the holiday season, and fed cattle supplies are expected to increase in the weeks ahead. Boxed beef demand has improved on the lower prices, providing some support for cattle futures.

Financial markets were very quiet for the week, showing little change as the U.S. dollar retraced back to 15-month lows and then stabilized. Energies were unchanged as well, trading in choppy action. Precious metals were strong again, despite the quiet financial markets. Investors continued to pile into the gold market and pushed it to another new all-time highs as the struggling dollar further solidified sentiment that inflation is inevitable and gold is the best inflation hedge. The Dow pushed to new 13-month highs on a steady stream of buying as investors look at the weak dollar as a sign that interest rates will stay low for some time and opt for the higher rates of return from equities and commodities.