Ag markets proved rather volatile Thursday morning

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Disappointing export sales exaggerated Wednesday night corn losses. Traders reportedly expect the USDA to boost its estimates of global corn supplies on tomorrow’s big reports, which seemingly weighed on CBOT futures last night. Those losses grew after the weekly Export Sales report stated last week’s result well below forecasts. March corn futures fell 6.75 cents at $4.1025/bushel by midsession Thursday, while May dropped 6.5 to $4.1875/bushel.

Short-covering is apparently boosting the soy complex. CONAB published its latest soy production estimate for Brazil this morning. That was largely unchanged around 90 million tonnes, but Brazil’s Ag Minister stated that the crop could ‘easily’ top 95 million. The Export Sales total also fell far short of expectations. And yet, CBOT future rallied moderately in early trading. Traders were probably taking profits on short positions ahead of tomorrow’s USDA releases. March soybeans rebounded 3.75 cents to $12.73/bushel by late Thursday morning, while March soyoil rose 0.04 cents to 37.72 cents/pound, and March soymeal added $2.5 to $415.0/ton.

The wheat export data also disappointed. Overnight soy gains may have sparked buying in the wheat markets, especially with traders likely looking for an excuse to take profits on shorts ahead of Friday’s USDA reports. However, the Export Sales report stated last week’s total about half of the smallest forecast, thereby sending futures lower. March CBOT wheat futures dove 6.5 cents to $5.8225/bushel in late Thursday morning action, while March KCBT wheat futures tumbled 2.5 cents to $6.345, and March MWE futures dipped 2.0 to $6.25.

Cattle futures backed away from early highs. Rising cash and wholesale prices played a big role in the recent advance, and are expected to remain seasonally strong through the first quarter. Traders may now suspect warming temperatures will boost fed cattle marketings and depress spot prices during the days ahead. As usual, much depends upon the outcome of this week’s cash trading. February cattle futures rallied 0.32 cents to 136.85 cents/pound late Thursday morning, while April futures climbed 0.27 to 137.25. Meanwhile, March feeder cattle futures ran up 0.50 cents to 169.05 cents/pound, and May added 0.37 to 170.05.

Wholesale strength seemingly supported hog futures Thursday morning. Wednesday afternoon cash and pork weakness apparently depressed hog futures in early trading. However, the Chicago market bounced substantially from early lows, thereby seeming to reflect expectations for the stronger result on the midday wholesale report. The rebound also had significant technical connotations. February hogs had dipped just 0.20 cents to 85.37 cents/pound at lunchtime Thursday, and June moved 0.40 lower to 100.65.

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