Corn futures broke down after early failure Tuesday. The yellow grain market built upon its bullish Monday move Tuesday morning, which likely reflected supportive USDA data and talk of increased Corn Belt dryness. However, many in the industry believe the USDA was too conservative in its crop forecast and apparently sold futures in a result. The losses accelerated late in the day. September corn dove 16.75 cents to $4.5525/bushel at Tuesday’s close, while December tumbled 16.75 cents to $4.4725.
The soy complex ended Tuesday in decidedly mixed fashion. Soybean futures also rallied strongly Tuesday morning and seemed set to continue rising. Talk of August Corn Belt dryness seemed particularly supportive. However, concurrent slippage in the corn and wheat pits apparently reignited concerns about the size of the forthcoming crop. September soybeans edged up 1.25 cents to $12.5775/bushel by late Tuesday morning, while November beans rose 2.5 to $12.2775. September soyoil climbed 0.24 cents to 42.62 cents/pound, but September soymeal sagged $0.9 to $401.8/ton.
The wheat markets followed corn prices lower Tuesday. Despite the supportive nature of Monday’s USDA reports, wheat futures also proved unable to sustain early gains. The simple fact that corn prices will almost surely fall far below year-ago levels remains a major obstacle to bullish objectives in the wheat pits. September CBOT wheat settled 6.75 cents lower at $6.2825/bushel Tuesday afternoon, while September KCBT wheat slid 4.0 cents to $6.9625, and September MGE futures skidded 4.25 cents to $7.325.
Cattle futures also backed away from early highs. Choice cutout surged Monday, thereby encouraging traders to expect another cash market advance later in the week. However, traders curtailed their enthusiasm after two other packers declined to join Tyson in rejecting cattle given the Zilmax growth promotant. Still, the firm CME showing seems rather bullish. October cattle rallied 0.67 cents to 128.07 cents/pound at its Tuesday settlement, while December added 0.50 cents to 129.97. September feeder cattle gained 0.70 cents to 157.70 cents/pound, and November lifted 0.65 cents to 160.65.
Lean hog futures were mixed Tuesday. Monday afternoon reports indicated slipping cash prices earlier in the day, while pork cutout values posted a substantial drop. Traders worry that the traditional second-half hog decline will carry prices substantially lower. However, the discounts already built into 2013 futures apparently enabled them to rebound late in the day. October hog futures closed 0.33 cents higher at 86.52 Tuesday, while December increased 0.20 cents to 83.25.