Ag markets were generally weak Wednesday night

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Corn futures remained weak Wednesday night. Tuesday’s monthly WASDE report was generally bullish for the corn outlook, since the USDA’s carryout forecast fell well short of expectations. The fact that corn futures couldn’t sustain their initial bullish reaction, sent a particularly negative signal to bearish traders, so it wasn’t terribly surprising to see corn continue sliding overnight. May corn slid 1.0 cent to $5.0125/bushel early Thursday morning, while December sagged 2.25 to $5.0325.

The soy complex continued Wednesday’s late setback. In contrast to the corn and wheat markets, soybeans closed substantially higher in the wake of yesterday’s WASDE report. However, the size of the gain was quite modest when compared to the gains posted in the report’s immediate wake. That may have set the stage for persistent weakness last night, particularly with the oil market being dragged lower by sliding Asian palm values. May soybeans fell 7.5 cents to $14.8775/bushel in predawn Thursday action, while May soyoil dropped 0.36 cents to 42.55 cents/pound, and May soymeal slipped $1.2 to $480.9/ton.

Weather news may be supporting the wheat markets. Wednesday’s WASDE report boosted the carryout forecast for the U.S. and for the world, which clearly had negative old-crop price implications. However, persistent dryness across the Great Plains remains a potentially bullish factor for golden grain prices, which may explain the slight gains posted by futures last night. May CBOT wheat futures gained 0.75 cents to $6.6975/bushel Wednesday night, while May KCBT wheat futures edged up 0.5 cent to $7.3375, and May MWE futures gained 3.5 cents to $7.1625.

Nearby cattle futures posted a mixed performance last night. The cattle/beef industry is anticipating sizeable seasonal losses during the days and weeks ahead. The ongoing decline in wholesale prices exemplifies the downward potential. However, the bearish forecasts already built into CME futures may be too large, which partially explains the mixed-to-higher CME price action seen lately. June cattle futures stabilized at 135.62 cents/pound early Thursday morning, while December skidded 0.10 to 140.45. Meanwhile, May feeder cattle slumped 0.17 cents to 180.05 cents/pound, but August rose 0.02 to 181.87.

Hog futures are feeling renewed pressure. After seemingly posting a major top last week, the hog and pork complex has proven generally weak lately. Cash prices did firm Wednesday, which apparently sparked the concurrent CME rebound. However, pork price fell dramatically yesterday afternoon, thereby depressing deferred futures. June hog futures sank 0.30 cents to 121.45 cents/pound in early Thursday action, and December tumbled 1.17 to 88.37.

Cotton futures rebounded modestly Wednesday night. Cotton futures proved surprisingly weak after initially reacting well to the supportive WASDE data. However, the equity markets posted a strong advance later in the day, which may have sparked fresh cotton buying based upon demand optimism. May cotton bounced 0.52 cents to 90.96 cents/pound just after sunrise (EDT) Thursday, while December cotton inched up 0.19 to 80.60.

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