Ag markets seemed pretty divergent Friday morning

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Short-covering seemed to dominate Friday morning grain trading. Traders are seeing little fresh news today and probably don’t expect much before next Monday’s Crop Progress report. The WASDE report follows next Wednesday. Anticipation of those releases may be encouraging traders to accelerate pre-weekend short-covering in the wake of the recent corn/wheat breakdown. July corn ran up 4.75 cents to $4.5375/bushel around midsession Friday, while December gained 3.75 cents to $4.51.

The soy complex turned mixed late Friday morning. As with corn, little news concerning soybeans and products has come out since Thursday’s export data were released. Oil is apparently being supported by strong short-covering, but technically weak beans and meal are seemingly benefiting little from such buying. July soybeans sagged 3.0 cents to $14.575/bushel as lunchtime loomed Friday, while July soyoil rallied 0.41 cents to 39.10 cents/pound, and July soymeal slid $2.7 to $487.9/ton.

The wheat markets also appear to be staging a short-covering rally. As with corn and beans, little fresh wheat news has emerged. That also seems to be spurring active short-covering prior to the weekend. Conditions in the southern and western Plains seem somewhat less favorable than those in the eastern Corn Belt, which may partially explain KC and MWE strength versus CBOT. July CBOT wheat futures bounced 5.5 cents to $6.1125/bushel late Friday morning, while July KCBT wheat jumped 12.5 cents to $7.265 and July MWE futures surged 10.0 cents to $7.005.

CME cattle prices turned mixed before midsession Friday. CME live cattle futures rose this week as traders came to anticipate firm-higher cash prices before the weekend. The nearby contracts have sustained the move, but deferred futures are weakening. That may reflect big wholesale losses posted yesterday afternoon and suspicions that seasonal cash/beef weakness will re-emerge by mid-June. August cattle moved up 0.22 cent to 141.55 cents/pound in late Friday-morning action, while December fell 0.35 cents to 147.27. Meanwhile, August feeder cattle rose 0.25 cents to 200.07 cents/pound, but October lost 0.05 to 200.47.

Seasonal optimism seems to be powering CME hogs. Thursday afternoon cash strength seemed supportive of Chicago swine futures despite concurrent pork weakness. Hog traders rather clearly continue expecting a big summer price surge, as indicated by the big July-August premiums being built upon at this juncture. August hog futures climbed 0.47 cents to 128.67 cents/pound around midsession Friday, while December surged 0.77 cents to 94.67.

Cotton futures remained weak Friday morning. Unlike the grain markets, cotton futures continued their recent slide last night and again this morning. There’s little fresh news, but one has to wonder if talk of rain across northern Texas is keeping pressure on prices. ICE values also look vulnerable to a follow-through drop. July cotton sank 0.32 cents to 85.18 cents/pound shortly before noon (EDT) Friday, while December cotton slipped 0.06 to 77.56.


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