The EIA report may have depressed corn futures Wednesday morning. Anticipation of a record U.S. corn crop and good results for other crops have exerted persistent downward pressure upon the crop markets lately, but prices apparently bounced in early Wednesday trading due to widespread short-covering ahead of Friday’s big USDA crop reports. However, corn futures turned lower in the wake of the weekly EIA energy report, since that indicated reduced ethanol production and rising stocks last week. December corn futures slid 1.75 cents to $4.2325/bushel around midsession Wednesday, while May lost 1.5 cents to $4.4175.
Short covering seemingly boosted the soy complex. Soybean and product prices rallied moderately this morning, which probably reflected general short-covering and position squaring ahead of Friday’s USDA Crop Production and WASDE reports. However, given widespread expectations for bearish production data, short-term gains seem likely to be limited. January soybean futures rose 5.75 cents to $12.56/bushel late Wednesday morning, while December soyoil edged 0.05 cents higher to 41.20 cents/pound, and December soymeal added $3.1 to $395.9/ton.
The wheat markets were decidedly mixed in Wednesday morning action Friday’s Crop Production reports should have limited application to the wheat markets, since the September reports probably captured the situation quite well. Still, traders have to be wary about the potential WASDE results. Thus, it wasn’t terribly surprising to see the Chicago and Kansas City markets down slightly, while Minneapolis rose modestly Wednesday morning. December CBOT wheat futures dipped 0.25 cent to $6.5575/bushel just before lunchtime Wednesday, and December KCBT wheat futures skidded 2.75 cents to $7.195, whereas December MWE futures moved up 0.5 to $7.1425.
Tight supplies are probably supporting cattle futures. Although beef prices aren’t acting particularly well at this juncture, the modest slippage seen so far this week may do little to lower bullish expectations for the short-term. That is, producers and bullish traders know supplies are tight and will almost surely continue tightening on a seasonal basis, thereby seeming to lend the market a bullish bias. December cattle futures rallied 0.17 cents to 132.32 cents/pound late Wednesday morning, while April futures crept up 0.07 to 134.22. January feeder cattle advanced 0.60 cents to 165.67 cents/pound, while March feeders climbed 0.47 cents to 165.42.
Concerted cash and wholesale losses are weighing on hog futures this morning. Although hog traders realize this is often a weak period for the hog and pork complex, Tuesday’s across-the-board weakness in the cash and wholesale markets are depressing CME prices so far today. December hog futures sank 0.62 cents at 87.62 cents/pound as the lunch hour loomed Wednesday, while April tumbled 0.57 to 93.07 cents/pound.