Ag markets began Wednesday in mixed fashion

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Continued talk of accelerated plantings is depressing corn futures. The corn market is very likely benefitting from strength spilling over from the soy and wheat complexes, especially with underlying demand for the yellow grain seeming quite robust as well. However, forecasts for persistent short-term dryness makes traders think Midwest plantings will surge during the days ahead, thereby improving fall production prospects. May corn skidded 2.25 cents to $5.015/bushel early Wednesday morning, while December dipped 2.0 to $5.0125.

Talk of vigorous demand is boosting the soy complex. Tuesday’s NOPA crush report showed strong U.S. activity last month and implied that U.S. demand for soybeans and its products remains extremely strong. That news powered prices higher yesterday and again in overnight action. May soybeans jumped 19.75 cents to $15.21/bushel Tuesday night, while May soyoil climbed 0.39 cents to 43.22 cents/pound, and May soymeal advanced $6.1 to $493.5/ton.

The wheat markets may be trading weather news once again. The Russia-Ukraine situation is probably providing persistent support for wheat prices due to the potential disruptions likely to result. But U.S. traders are also watching the weather, since current conditions aren’t particularly favorable to large crops. Reports that Monday’s cold didn’t do a great deal of damage probably undercut prices overnight. May CBOT wheat futures stalled at $7.0175/bushel in early Wednesday action, while May KCBT wheat futures slid 3.0 cents to $7.625, and May MWE futures slipped 1.75 cent to $7.3675.

Technicians may be pressuring the cattle market. CME cattle traders are expecting a sizeable seasonal decline during the coming days and weeks, but the large discounts already built into futures may be limiting their downside potential. On the other hand, bulls recently failed to push prices above major chart resistance, which is apparently encouraging technical selling at this point. June cattle futures slumped 0.15 cents to 135.27 cents/pound just after dawn Wednesday, while December edged 0.15 lower to 139.70. Meanwhile, May feeder cattle stumbled 0.22 cents to 179.55 cents/pound, and August lost 0.27 to 182.30.

Hog futures may face fresh selling. Anticipation of seasonal strength has been supporting the hog and pork complex lately, with bulls apparently thinking prices will come back from recent losses. However, cash and wholesale prices dove Tuesday afternoon, thereby spurring fresh CME selling overnight. June hog futures fell 0.80 cents to 121.72 cents/pound in early Wednesday trading, while December dropped 0.40 to 88.30.

Forecasts for reduced Chinese plantings boosted cotton futures last night. Tuesday’s cotton drop seemed to set the stage for follow-through losses, but Chinese news sparked a fresh bounce. Officials with a Chinese industry association predicted the nation’s 2014 cotton plantings will fall 12% short of last year, thereby implying a commensurate cut in forthcoming production and improving prices. May cotton rallied 0.71 cents to 90.63 cents/pound soon after sunrise (EDT) Wednesday, while December cotton ran up 0.60 to 81.51.

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