Bullard comments may have depressed commodities Friday. The commodity sector moved generally lower Friday morning, seeming to react negatively to a suggestion from St. Louis Fed President James Bullard that the Fed may undertake a ‘small taper’ of its bond buying program next month. The crop markets, including corn, followed gold and energy prices lower. December corn sank 7.25 cents to $4.5225/bushel around midsession Friday, and May lost 7.0 cents to $4.7325.
The soy complex suffered rather badly Friday morning. Soybean and product prices proved quite vulnerable to the general commodity decline posted in early Friday trading. Ongoing rainfall over the Corn Belt, as well as the negative demand implications of the fresh ‘taper’ talk probably weighed upon prices, as did losses in the Asian palm oil markets. November soybeans dove 19.5 cents to $13.20/bushel in late-morning trading, while October soyoil tanked by 0.43 cents to 42.281 cents/pound, and October soymeal declined $5.7 to $415.9/ton.
Wheat futures also declined in late-week trading. The wheat markets showed little ability to resist the general downdraft in commodity prices Friday. Fed President Bullard’s statements probably played a role in the drop, but traders may also be anticipating a much larger 2014 winter wheat crop in light of recent rainfall over the Great Plains. December CBOT wheat dropped 11.5 cents to $6.455/bushel Friday morning, while December KCBT wheat slumped 9.25 cents to $6.9275, and December MGE futures sagged 4.75 cents to $7.0375.
Cattle futures bucked the downward trend as lunchtime approached Friday. Although future beef demand might also suffer in an atmosphere implied by the bearish market reaction to the Bullard statement about Fed tapering, live cattle futures proved able to post modest gains late Friday morning. That may have reflected cautious optimism about the likely outcome of this week’s cash trading, as well as short-covering ahead of this afternoon’s, USDA Cattle on Feed report. October cattle futures edged up 0.1 cents to 126.02 cents/pound in late-morning trading, while December inched 0.07 higher to 129.80. Meanwhile, October feeder cattle rallied 0.75 cents to 160.12 cents/pound on the grain and soy weakness, and January added 0.42 cents to 160.40.
Hog futures also took it on the chin as the weekend approached. Recent weakness in wholesale pork values has apparently tended to cap rally attempts in hog futures despite rising cash values. However, Friday morning calls implied country market weakness as well, thereby seeming to spark active selling in Chicago. October hog futures had fallen 1.02 cents to 90.12 cents/pound by late Friday morning, while December tumbled 1.00 cent to 86.30.