Ag markets proved quite mixed again Tuesday

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Corn futures firmed Tuesday afternoon. Predictions for improved rainfall over Argentina’s main crop areas during the days ahead weighed upon the corn market Tuesday morning. However, reports that December Chinese imports of U.S. corn and distillers grains may have sparked some late bargain hunting, which might explain the price firmness seen at the close. March corn edged up 1.0 cent to $4.25/bushel as trading wound down Tuesday, while May rebounded 0.5 to $4.3225/bushel.

The soy complex took a big hit Tuesday. Argentina’s grain and soy fields got less rain than previously expected last weekend, but the latest forecasts apparently imply greater precipitation prospects during the days ahead. Beans and meal turned sharply lower, especially after traders started talking about a shift in Chinese buying to South American beans. In contrast, rising palm oil prices in Asia sparked a big bounce in CBOT soyoil futures. March soybeans plummeted 36.0 cents to $12.805/bushel at Tuesday’s close, while March soyoil jumped 0.36 cents to 38.10 cents/pound, and March soymeal plunged $18.0 to $416.5/ton.

The wheat markets suffered a late setback. Wheat futures began the week firmly despite concurrent corn and bean losses. That may have reflected talk of improved export business lately, as well as concerns about potential freeze damage from “Polar Vortex 2” next week. Conversely, the weekly Export Inspections report apparently disappointed traders and caused the weak close. March CBOT wheat futures settled 1.25 cents lower at $5.6225/bushel Tuesday afternoon, while March KCBT wheat futures slid 2.0 cents to $6.2125, and March MWE futures dropped 4.0 to $6.1375.

Spiking beef prices boosted cattle futures once again. The cattle market lost its upward momentum late last week, which probably reflected trader suspicions that the wholesale market would soon peak. However, beef prices leapt again Monday, thereby suggesting packers will pay up for fed cattle again later this week. February cattle futures soared 1.20 cents to 141.55 cents/pound at their Tuesday settlement, while April futures leapt 0.92 to 140.22. Meanwhile, March feeder cattle futures climbed 0.40 cents to 168.32 cents/pound, and May advanced 0.50 to 170.00.

Hog futures started the week on a mixed note. Concerns about sizeable short-term hog supplies and its premium to the CME index appear to be depressing the nearby February contract Tuesday. However, ideas that supplies will become much tighter when spring rolls around apparently boosted the spring-summer contracts. February hogs skidded 0.20 cents to 85.97 cents/pound in late Tuesday trading, whereas June added 0.27 to 101.85.

Cotton resumed its rally Tuesday. Over the weekend Chinese officials formally announced that they will soon end the government’s cotton stockpiling program. Talk Pakistan and Bangladesh are buying cheap Indian product may have supported the market to some extent, but technical factors probably played a larger role in boosting cotton futures as the day passed. March cotton surged 1.33 cents to 88.13 cents/pound at Tuesday’s closing, while July cotton ran up 1.55 cents to 87.91.

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