Corn futures were mixed in early Tuesday trading. The weekly USDA Crop Progress report indicated that corn conditions had actually posted a contra-seasonal improvement last week, thereby reflecting the strong prospects traders have discussed lately. However, the resulting price weakness seemed to be offset by old crop firmness, since nearby futures edged higher overnight. September corn rose 2.0 cents to $4.7125/bushel just after sunrise Tuesday, while December gained 0.25 cent to $4.6075.
The soy complex also posted modest divergences early Tuesday. As with corn, a surprising improvement in the crop ratings posted Monday afternoon weighed upon new crop prices. Soybean oil futures slipped despite firmness in the Asian palm oil markets. And despite talk that the old crop situation has largely been resolved, nearby meal posted modest overnight gains. September soybean futures slipped 1.75 cents to $12.0575/bushel early Tuesday morning, while November beans slid 4.75 cents to $11.785. September soyoil declined 0.23 cents to 42.59 cents/pound, while September soymeal rallied $1.7 to $378.8/ton.
Wheat rebounded from Monday losses despite good crop ratings. Wheat futures fell sharply yesterday, possibly in response to good rainfall over the Southern Plains. One might have assumed the golden grain markets would continue sliding after the Monday afternoon Crop Progress report indicated the winter wheat harvest is wrapping up and spring wheat conditions improved. News that Egypt, the recent number one importer, is in the market for more grain may have sparked the bounce. September CBOT wheat climbed 4.5 cents to $6.4975/bushel as the sun rose over Chicago Tuesday, while September KCBT wheat added 4.0 cents to $6.995, and September MGE futures lifted 3.25 cents to $7.37.
Cattle and feeder advanced slightly in early Tuesday action. The stage seemed set for cattle weakness Monday afternoon, since wholesale prices declined and 50 delivery notices were posted against expiring August futures. Traders may simply be expecting seasonal strength and/or were encouraged by spillover from the hog pit. October cattle inched up 0.12 cents to 124.67 cents/pound in overnight action, while December rallied 0.07 to 127.10. September feeder cattle futures improved 0.10 cents to 157.10 cents/pound, but November was untraded at 160.00..
Lean hog futures continued their surge in Monday night trading. Persistent wholesale strength and a fresh bounce in cash prices probably sparked the latest gain. Bulls were very likely encouraged by the technical implications of the Monday surge as well. October hog futures advanced 0.57 cents to 86.07 early Tuesday morning, while December moved up 0.37 to 82.57.
Cotton futures firmed despite an unchanged crop rating. The New York market sustained its modest Monday gains in overnight trading despite the fact that the USDA indicated the current crop maintained its reading from the week prior. Given the relatively tight old crop situation, traders may view the lack of improvement along with corn and soybeans as implying underlying problems. October cotton futures were untraded at 85.40 cents/pound Monday night, while December gained 0.12 cents to 85.32.