Ag markets were narrowly mixed Monday night
Corn futures were steady-weak Monday night. The corn market edged higher yesterday, which marked a reaction to good export news. The nearby contracts were largely unchanged in overnight action. That may reflect underlying technical strength, since the rise pushed the nearby March contract above short-term moving average support. March corn stalled at $4.325/bushel early Tuesday morning, while May dipped 0.25 to $4.3825.
The soy complex also moved sideways. The strength of underlying demand seems to be offering persistent support soybeans and products at this point. Traders probably expect growing pressure from the accelerating Brazilian harvest, but their likely problems in getting their crop shipped could limit the selling. Soyoil prices stabilized despite another dip in Asian palm values. March soybeans skidded 0.5 cent to $12.8725/bushel in pre-dawn Tuesday trading, while March soyoil crept up 0.08 cents to 37.14 cents/pound, and March soymeal lost $0.2 to $430.7/ton.
The wheat markets led the crop markets higher overnight. Concerns about freeze damage to the U.S. winter wheat crop apparently reemerged Monday night, as indicated by the bullish leadership provided by the Chicago and Kansas City markets. Global demand still seems robust, but massive supplies are almost surely dampening bullish hopes. March CBOT wheat futures bounced 3.75 cents to $5.6725/bushel in early Tuesday action, while March KCBT wheat futures lifted 2.5 cents to $6.25, and March MWE futures inched up 0.25 to $6.0675.
Cattle futures also traded firmly Monday night. The cattle market is stabilizing in the wake of its huge mid-January rally and subsequent setback. Bulls probably hope Monday’s wholesale surge will be sustained, whereas bears likely suspect it will end rather quickly. The fact that futures are priced well below recent cash also favors bullish arguments. February cattle futures gained 0.10 cents to 143.25 cents/pound Monday afternoon, while the April contract rose 0.07 cents to 140.62. Meanwhile, March feeder cattle slipped 0.02 cents to 168.77 cents/pound, and May slid 0.15 to 169.67.
Divergent cash and wholesale markets robbed hog futures of direction. Swine traders are expecting a significant seasonal rally across the hog and pork complex during the days and weeks just ahead. However, those markets have been quite mixed lately, as was the case again last night. Thus, the minimal gains posted early Tuesday morning were hardly surprising. February hogs edged 0.05 cents higher to 85.62 cents/pound as Tuesday dawned over Chicago, while June added 0.20 to 102.52.
Cotton futures are stabilizing in the wake of Monday’s breakdown. Ongoing financial market weakness, particularly in several developing countries, along with rising exchange stocks apparently sparked Monday’s big cotton dive. The drop essentially left nearby futures right back in the middle of their trading range, so it wasn’t terribly surprising to see price rise somewhat last night. March cotton improved by 0.17 cents to 84.42 cents/pound just after sunrise (EST) Tuesday, while July cotton rose 0.21 cents to 84.97.