Soy losses seemed to weigh on corn futures Wednesday morning. The corn market began Wednesday on a firm note, possibly due to a slight reduction in forecasts for South American rainfall later this week. However, prices set back from early highs as the soybean complex came under renewed pressure. March corn had risen 1.0 cent to $4.26/bushel by late Wednesday morning, while May gained 0.5 to $4.3275/bushel.
Cash weakness and technical issues undercut the soy complex. Talk of the accelerating Brazilian harvest reported sent Gulf soy quotes downward Wednesday morning, which in turn spurred selling at the CBOT. Having the March future drop below support at its 200-day moving average likely exaggerated the losses. Soyoil values remained under pressure from the overnight Asian palm oil decline. March soybeans fell 7.0 cents to $12.735/bushel around midsession Wednesday, while March soyoil dropped 0.24 cents to 37.86 cents/pound, and March soymeal lost $0.7 to $415.8/ton.
The wheat markets remained firm this morning. Talk of improving export demand supported wheat futures overnight, especially after Algeria tendered to buy 500,000 tonnes in the early morning hours. Traders also remain concerned about the damage being done to U.S. winter wheat, since severe cold and Southern Plains dryness have emerged as factors lately. However, the Chicago market did seem to suffer from spillover soy weakness. March CBOT wheat futures slid 0.75 cent to $5.615/bushel just before lunchtime Wednesday, while March KCBT wheat futures rallied 3.5 cents to $6.2475, and March MWE futures ran up 3.25 to $6.17.
Cattle futures struggled to build upon recent gains in early trading. Surging beef prices boosted cattle futures again Tuesday, due in part in to expectations for another rise in cash prices later this week. However, having the Tuesday afternoon beef report state cutout values only slightly above the midday quote raised questions about the complex’s upside potential from this point. February cattle futures advanced 0.27 cents to 141.82 cents/pound late Wednesday morning, while April futures climbed 0.15 to 140.37. Meanwhile, March feeder cattle futures slumped 0.32 cents to 168.00 cents/pound, and May slipped 0.30 to 169.70.
Hog futures are moving lower. Given recent slippage by the exchange index, CME swine traders are apparently worried about the cash markets’ ability to justify nearby futures premiums. Modest cash gains posted Tuesday may have partially alleviated those concerns, but concurrent wholesale weakness seemingly reinforced bearish fears. February hogs tumbled 0.82 cents to 85.15 cents/pound just before the Chicago lunch hour, while June sagged 0.35 to 101.50.
Cotton proved relatively weak Wednesday morning. Cotton futures had recently rallied strongly in response to talk of tight U.S. supplies and reduced 2014 Chinese plantings. However, prices dipped overnight in apparent reaction to Chinese news. They are reportedly considering the use of price targets, with a reliance on international prices. Given the size of global supplies, that could prove long-term bearish. March cotton skidded 0.33 cents to 87.80 cents/pound just before noon (EST) Wednesday, while July cotton sank 0.43 cents to 87.48.