Ag markets exhibited mixed degrees of strength Wednesday

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Nearby corn futures settled slightly higher Wednesday. Corn futures dipped in early-Wednesday trading, and were slow to react to good export news announced by the USDA. However, technically inspired buying seemed to power the March price modestly higher by session’s end. March corn rose 1.5 cents to $4.4325/bushel Wednesday afternoon, while May slipped 0.25 to $4.475.

Technical buying also seemed to boost the soy complex. Forecasts for improved rainfall over Brazil’s main grain/soy growing area apparently depressed soybean and product prices Wednesday morning, but the markets firmed as the day passed. Traders credited technical buying for the bean strength, whereas active lifting of meal/oil spreads caused those markets to diverge. March soybeans settled 3.0 cents higher at $13.1625/bushel Wednesday, while March soyoil surged 0.52 cents to 38.23 cents/pound, and March soymeal fell $5.0 to $442.0/ton.

Wheat futures exhibited considerable strength Wednesday afternoon. Tuesday’s price action suggested the wheat markets had bottomed. Traders are reportedly worrying about southern Plains dryness and freeze damage in the Midwest. But the late strength also has a substantial technical component after the nearby contracts topped short-term resistance Tuesday. March CBOT wheat futures advanced 3.0 cents to $5.875/bushel at their Wednesday settlement, while March KCBT wheat futures climbed 4.75 cents to $6.5125, and March MWE futures added 6.0 to $6.295.

Talk of limited marketings seemed to support cattle futures. The recent breakdown from record highs has discouraged cattle traders, but emerging talk of limited short-term marketings due to poor weather apparently renewed concerns about late-winter cattle/beef supplies. Firming wholesale prices may also have contributed to Wednesday’s modest bounce. April cattle futures rallied 0.20 cents to 139.10 cents/pound in late Wednesday action, while August bounced 0.10 cents to 129.65. Meanwhile, March feeder cattle skidded 0.05 cents to 166.92 cents/pound, and May edged up 0.15 to 168.32.

Several factors may have sparked Wednesday’s hog surge. Fresh concerns about late-winter/early spring hog supplies in the wake of last year’s PEDV outbreak reportedly boosted hog futures this morning, as did rumors of increased grocery industry interest in pork. Traders also suspect Russia’s return to the U.S. market next month could exaggerate spring demand. April hogs soared 1.87 cents to 95.00 cents/pound at Wednesday’s close, while June leapt 1.65 to 105.40.

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