July soybeans were trading 3 cents higher near 7:30 cst with November near 1 1/2 higher. China futures closed 0.6% lower overnight while Malaysia palm oil futures were down 0.6% overnight. Shanghai stocks posted their 7th straight decline overnight and reportedly Chinese markets also saw very low trading volume. European equity markets were weaker again to start, as press coverage suggests that EU leaders are not finding common ground yet on a number of basic issues. With German unemployment levels rising overnight and Euro zone consumer confidence declining slightly, but falling further from very weak levels overall, the news flow from Europe is generally fostering a risk off vibe. The US scheduled report slate today will present initial claims and a revision of the 1st quarter US GDP reading. Expectations for the claims call for a minimal non distinct decline, while the GDP reading is generally expected to be mostly unchanged. Therefore the trade might not be able to glean much in the way of fresh direction on the US economy from the data flow this morning. Key numbers for the report Friday include soybean planted area (trade sees acreage up 1.6 million) and corn stocks for June 1st. After the release, traders are likely to believe that the soybean acreage estimate from the USDA may be too high as many parts of the Midwest will not be able to double crop soybeans over harvested wheat due to topsoil dryness. Weather focus is rightfully on the corn market now as pollination damage which may or may not occur in the next 2 weeks will be irreversible. The critical reproductive stage for soybeans is not until late July and early August. However, drought conditions continue to worsen and traders remain concern with very high temperatures and a lack of rainfall for the eastern and southern Corn Belt, the northern delta and much of Missouri. With dry subsoil conditions even in Iowa, an inch of rain per week will not be enough to keep up with needs so a short period of high temps and dry conditions can quickly add to stressful conditions. Stats Canada pegged canola planted area at 21.27 million acres which was the high end of estimates and well above 18.9 million last year. For the second day in a row yesterday, November soybeans posted a contract high and a lower close. Speculative profit taking and producer selling was noted, ahead of the USDA reports for Friday. The two week weather forecast calls for above normal temperature and below normal rainfall for most of the Soybean Belt. The trade continues to monitor crop and weather conditions but expect further deterioration in the new crop soybean yield if weather patterns in July reflect those of June. Traders see rains for late this week into the weekend for a band across Iowa, the northern half of Illinois and northern Indiana with 1/2 to 1 inch or more accumulation as thunderstorm activity moves across the same areas. Areas south of this look to receive little rain chances in the next two weeks and any areas which miss out on rains in the northern Midwest will also be under stress with the heat. For the Quarterly Grain Stocks report, traders are looking for June 1st soybean stocks in storage to be about 15 million bushels higher than last year's 619 million bushels. They are looking for soybean acreage to be around 75.5 million acres, up from the March estimate of 73.9 million. For weekly export sales, traders see sales near 725,000 tonnes from 608,000 last week.