The weekly USDA Export Sales report seemed rather bearish for corn futures, since both the new and old crop totals came in modestly below forecast ranges. Nevertheless, corn futures turned sharply higher soon after the data release. That probably reflected short-covering ahead of the Friday morning release of the monthly USDA WASDE and Crop Production reports, especially since traders expect them to imply persistently tight domestic conditions over the short run. July corn rallied 9.0 cents to $6.42/bushel late Thursday morning, while December climbed 5.0 cents to $5.37.
Tight old crop conditions and firm country prices apparently kept nearby soybean futures well supported early Thursday morning despite disappointing mixed results on the weekly Export Sales report. Traders may also have been abandoning shorts ahead of the big USDA reports tomorrow. Indeed, they were probably more inclined to do so after the Brazilian agricultural department (CONAB) revised its estimate of the just-completed soybean harvest downward by 400,000 tonnes to 81.5 million. July soybean futures rose 14.25 cents to $14.05/bushel as the lunch hour loomed Thursday, while July soyoil climbed 0.44 cents to 49.26 cents/pound, and July soybean meal added $2.8 to $410.4/ton.
The Export Sales report seems supportive of old crop wheat futures, while disappointing results looked negative for the 2013/14 contracts. However, those considerations also fell by the wayside as traders seemed to start evening up net short positions ahead of the Friday morning USDA reports. The fact that those will contain the first official estimate of the current winter wheat crop could move the markets dramatically Friday afternoon, thereby seeming to prompt a rush for the exits. July CBOT wheat futures jumped 16.25 cents to $7.2225/bushel around midsession Thursday, while July KCBT wheat surged 14.75 cents to $7.75, and July MGE futures advanced 10.75 cents to $8.27.
Anticipation of seasonal weakness weighed upon cattle futures again in early Thursday trading despite the Wednesday afternoon choice beef cutout spike to a record high. Noon Wednesday news of significant cash market losses from week-ago levels probably encouraged persistent selling. On the other hand, the discounts already built into nearby futures could limit their downside potential. Prices had actually bounced somewhat around midsession Thursday. June cattle edged up 0.20 cents to 120.40 cents/pound late Thursday morning, while December inched 0.10 cents to 124.82. August feeder cattle futures climbed 0.37 cents to 145.70 cents/pound, while November added 0.05 cents to 150.15.
Hog prices usually buck the downward cattle trend at this time of year, as indicated by the big surge posted by country swine values of the past few weeks. However, with grocers likely completing their pork purchases for Memorial Day features during the days ahead, CME traders are apparently become quite cautious about the short-term outlook. That would explain the mixed trading seen Thursday morning. June hog futures dipped 0.15 cents to 91.62 cents/pound, while December futures lost 0.10 cents to 78.05.