Corn futures barely moved Wednesday night, possibly due to trader uncertainty about the result of the weekly USDA Export Sales report to be released this morning. The slippage may also be due to the fact that wheat prices have been rallying lately due to surging demand from feedlots, due in part to the fact that soft red winter wheat has been cheaper than corn. Higher protein levels generally make wheat more valuable than the yellow grain. May corn slipped 0.75 cents to $709.5/bushel early Thursday morning, while December edged 0.5 cent higher to $5.555.

Soybean futures also fell Wednesday and again early Thursday morning, with traders continuing to blame U.S. dollar strength and recent talk of slowing Chinese buying as well. Indeed, prices slipped in China overnight due to concerns about demand strength as margins in the Chinese hog industry turn red. Weak palm oil prices probably weighed upon soybean oil and beans as well. May soybeans dipped 6.0 cents to $14.41/bushel Wednesday afternoon, while May soyoil lost 0.31 cents to 49.21 cents/pound, and May meal skidded $1.6 to $427.3/ton.

Nearby wheat futures rose early Thursday morning, while deferred values dipped modestly. Growing talk of surging feed demand for soft red winter wheat has apparently powered its late advance. The BNSF railway reportedly cut their fees for shipping Chicago wheat from the Midwest to the Southern Plains, which has apparently sparked a big buying binge from feedlots in the latter region. That also explains the leadership exhibited by CBOT futures. May CBOT wheat futures climbed 1.5 cent to $7.115/bushel in early Thursday trading, while May KCBT wheat was up 0.5 cent to $7.3825, and May MGE futures were unchanged at $7.955.

Cattle futures were mixed Wednesday night, with June slippage matching a rise by the nearby April contract. These shifts may represent trader uncertainty about the short-term cash outlook. That is, after appearing very confident about a rise in country market prices later this week, CME traders apparently reportedly became rather pessimistic Wednesday. If cash prices do not increase, they have little reason for optimism about second quarter prospects. April cattle rose 0.15 cents to 128.70 cents/pound early Thursday morning, while August was unchanged at 124.87. Meanwhile, April feeder cattle slid 0.05 cents to 142.67 cents/pound, and August fell 0.22 cents to 151.62.

Despite recent slippage at both the cash and wholesale levels, lean hog futures rallied modestly overnight. Given the historical tendency for hog market weakness through much of March, the rise is rather surprising. It may simply represent a technical bounce from chart support in the 80.50-81.00 cent area. April hogs gained 0.20 cents to 80.85 cents/pound early Thursday morning, while June added 0.07 cents to 90.15.

Cotton futures continued their ongoing rally in early Thursday trading. As has often been the case lately, there was no substantive news, which, given the current situation, left the door open for more buying from bulls. It will be interesting to see if the weekly USDA Export Sales report confirms bullish ideas about export demand. May cotton climbed 0.59 cents to 89.20 cents/pound Wednesday night, while December gained 0.40 cents to 87.91.