Chinese news seemed to boost corn futures Tuesday night. Trade positioning ahead of Friday’s big USDA reports will probably limit price movements during the interim, but did not prevent a modest overnight rise in corn futures. Talk that China is relaxing checks on imported U.S. distillers grains probably boosted the yellow grain. March corn futures inched up 0.75 cent to $4.2675/bushel early Wednesday morning, while May added 0.75 at $4.345/bushel..
Prospects for large South American crops are depressing the soy complex. After posting a strong performance through much of November and December, the soy complex has proven surprisingly weak lately. The looming USDA reports are probably playing a role in the latest drop, especially with traders reportedly anticipating large estimates for South American production. March soybeans fell 6.0 cents to $12.70/bushel in early Wednesday activity, while March soyoil dropped 0.35 cents to 37.58 cents/pound, and March soymeal slid $0.9 to $414.9/ton.
Talk of weather and exports seemingly sparked wheat buying. Although talk of frost damage to U.S. wheat fields diminished Tuesday, traders again cited it as a factor supporting prices last night. In addition, industry sources apparently remain confident of underlying export demand strength going forward. Thus, golden grain prices proved surprisingly strong in early Wednesday trading. March CBOT wheat futures climbed 3.75 cents to $6.0625/bushel in pre-dawn Wednesday action, while March KCBT wheat futures surged 4.5 cents to $6.4975, and March MWE futures moved up 4.5 to $6.3525.
Rising beef prices are supporting cattle futures again Wednesday morning. The cattle market dipped Tuesday after having rallied strongly through the holiday season. Rising cash and wholesale prices played a big role in the advance, so it wasn’t surprising to see futures turn upward again last night, since beef cutout values reportedly rose strongly again yesterday. February cattle futures rallied 0.12 cents to 136.65 cents/pound as Wednesday dawned over Chicago, while April futures ran up 0.17 to 136.52. Meanwhile, March feeder cattle futures slipped 0.12 cents to 167.60 cents/pound, and May skidded 0.25 to 169.12.
Divergent cash and wholesale markets stalled CME hogs. Hog traders are expecting a sizeable seasonal advance in cash and wholesale prices over the next six weeks. Pork cutout jumped Tuesday afternoon, but big losses in the western Corn Belt cash markets offset that bullish news. Those added up to mixed CME trading last night. February hogs inched 0.05 cents lower to 85.47 cents/pound early Wednesday morning, while June edged up 0.02 to 100.65.
Estimates of reduced Chinese imports apparently undercut cotton futures. Statements indicating Chinese cotton acreage and production will decline this year sparked early-week gains. However, an officer with a large U.S. exporter argued last night that Chinese imports will also decline as they end their big stockpiling programs. ICE prices suffered as a result. March cotton slumped 0.40 cents to 84.27 cents/pound just after sunrise (EST) Wednesday, while July cotton lost 0.33 cents to 83.95.