Forecasts for favorable weather appear to be depressing crop prices. The grain/soy industry expects record harvests, but the latest forecasts imply very favorable combining weather through mid-November, which could enhance the ultimate totals. Those ideas, along with a fresh U.S. dollar surge apparently depressed corn futures Tuesday night. December corn futures declined 4.5 cents to $3.60/bushel early Wednesday morning, while May lost 4.25 to $3.8175.
The soy complex also continued sliding Tuesday night. The same factors weighing on corn futures were reportedly dragging bean and product prices lower as well. Rising U.S. dollar values raise the cost of American goods to export customers. Concurrent losses in crude and palm oil values are still depressing soyoil; meal is holding up well, but has been unable to escape the general decline. January soybean futures fell 12.25 cents to $9.975/bushel last night, while December soyoil dove 0.55 cents to 32.52 cents/pound, and December meal dipped $3.8 to $368.7/ton.
Dollar strength is undercutting wheat markets as well. The winter wheat harvest is over six months away, so other factors are affecting golden grain prices at this point. Much depends upon demand strength, so having the U.S. dollar once again trading at four-year highs bodes rather ill for export prospects. Ongoing corn and soy losses are helping the bullish cause either. December CBOT wheat slumped 4.0 cents to $5.265/bushel in early Wednesday trading, while December KC wheat sagged 3.0 cents to $5.8725/bushel, and December MWE wheat slid 2.5 to $5.665.
Cattle futures traded mixed to higher Tuesday. Although recent news hasn’t been very supportive of cattle futures, the situation remains very tight. Thus, cattle traders appeared to await news yesterday, with bulls and funds rolling longs out of the nearby contracts and into their spring/summer counterparts. Feeders rallied strongly. However, late reports of beef slippage could weigh on prices at today’s opening. December live cattle futures ended Tuesday having lost 0.40 cents to 166.65 cents/pound, while April futures moved up 0.47 to 166.27. Meanwhile, January feeder cattle futures leapt 1.80 cents to 231.60 cents/pound, and March feeders jumped 1.60 to 228.52.
Falling pork prices reversed Tuesday’s early CME hog gains. As expected, Monday’s late spot market firmness translated into a strong CME hog opening yesterday. However, insider talk that pork prices were declining apparently triggered the midmorning reversal that carried into the close. Tuesday’s late cash and pork reports confirmed the weakness, which bodes rather ill for today’s opening. December hog futures settled down 0.87 cents at 87.97 cents/pound Tuesday afternoon, while April hogs tumbled 1.00 to 88.70.
The news isn't encouraging cotton bulls either. Although current equity index strength implies good domestic demand for cotton, the U.S. dollar advance could hurt exports. Overnight news that Chinese officials will give cotton farmers outside their main cotton growing area a sizeable subsidy doesn’t bode well for exports either. December cotton futures declined 0.34 cents to 62.46 cents/pound shortly after sunrise Wednesday, while March futures dropped 0.26 cents to 61.71.