Ag market traders are awaiting the Export Sales report

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Corn futures bounced modestly early Thursday morning after dropping sharply Wednesday afternoon. The rise seemed to reflect firming soybean prices, whereas the preceding breakdown marked an apparent reaction to improving U.S. crop prospects and talk of slowing export demand. Traders may also have been exiting positions on both sides of the market ahead of the Thursday morning Export Sales report and the Friday morning release of the USDA WASDE report. May corn rose 0.5 cent to $6.89/bushel in overnight action, whereas December edged downward 0.25 cent to $5.44.

Soybean futures rose moderately in overnight action. The likely cause of the rise came from Brazil, where its USDA counterpart CONAB forecast its 2013 soybean harvest at 82.1 million tonnes, which represented a 1.3 million tonne reduction from its February estimate. Soybean traders are also looking forward to the looming release of the Export Sales and WASDE reports from the USDA. May soybeans gained 3.75 cents to $14.6975/bushel early Thursday morning, while May soyoil edged 0.04 cents higher to 50.30 cents/pound, and May meal gained $1.4 to $436.7/ton.

The wheat market seemed to rebound in concert with the modest gains posted by corn and soybeans Wednesday night. Bulls may also have been responding to news of sizeable (93,680 tonnes) purchase by Taiwanese interests. Conversely, traders seemed to pay little attention to forecasts for record global production in 2013-14. They are probably more closely focused upon the forthcoming release of the weekly Export Sales report later this morning and the monthly WASDE report Friday. May CBOT wheat futures climbed 1.5 cents to $6.85/bushel as dawn was breaking over Chicago, while May KCBT wheat rose 3.5 cents to $7.28, and May MGE futures surged 8.5 cents to $7.92.

Cattle futures remained weak early Thursday morning despite ongoing wholesale market gains. Choice cutout values added 2.21 cents/pound Wednesday afternoon, which means they have spiked almost 12.99 cents over the past 10 days. CME traders are very likely reacting to Wednesday morning news that a few Panhandle cattle had traded at 128 cents/pound, steady with last week. That almost surely disappointed bulls expecting sustained cash gains. April cattle slipped 0.12 cents to 128.67 cents/pound in early morning activity, while August dipped 0.10 cents to 124.70. Meanwhile, April feeder cattle dropped 0.42 cents to 141.82 cents/pound, while August sank 0.55 cents to 150.90.

Hog futures rebounded from multi-month lows Wednesday and again early Thursday morning. Recent wholesale losses rather obviously weighed upon futures to start the week, but persistent reports of firming country markets are probably supporting the market at this point. Given the large losses suffered since late January, CME prices are very likely due for a substantial technical bounce as well. April hogs rose 0.62 cents to 79.87 cents/pound overnight, while June rallied 0.70 cents at 90.15.

After marching substantially higher over the preceding six trading sessions, cotton futures dipped early Thursday morning. The advance was largely driven by bullish supply/demand and export ideas, with the belief that China will continue buying and stockpiling product in order to support its domestic market during the weeks and months ahead. U.S. traders apparently expect supportive data on the weekly Export Sales (Thursday) and WASDE (Friday) reports from the USDA, but many were probably taking profits overnight. May cotton dipped 0.59 cents to 87.37 cents/pound in early Thursday electronic price action, while December fell 1.01 cents to 85.30.

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