Corn futures traded higher on Tuesday. Firm cash market and continued talk of a smaller corn crop in Argentina pushed prices higher. Basis levels have been firming as farmer selling has been light recently. Rumors surfaced today that Argentina may curb export of corn, although the rumor was denied by the government. Hot and dry weather during the growing season has curbed production estimates and recent rainfall was too late to help the crop much. March ended 10 1/4 cents higher at $6.30 1/4 and May was 9 1/2 cents higher at $6.35 1/4.
Soybean futures were higher on Tuesday. The market was lower much of the day on better-than-expected rainfall in some dry areas of Argentina, strength in the dollar and weakness in equities markets. But the soybean market turned higher by spillover support from corn, firm cash basis levels and on unconfirmed rumors that Argentina might ban exports. March closed 2 1/2 cents higher at $12.20 and May was 3 1/4 cents higher at $12.28 3/4.
Wheat futures traded solidly higher on Tuesday. Short-covering gains were triggered by unconfirmed rumors that Russia might curb grain export by putting on an export tariffs. Commodity funds are holding a large net short position, making short-covering rallies my likely. Firm cash markets were also supportive to the market. CBOT March ended 13 3/4 cents higher at $6.33 1/2, KCBT March closed 12 1/2 cents higher at $6.86 and MGE March was 1/2 of a cent higher at $8.03 3/4.
Cattle futures traded solidly higher on Tuesday. A rally in boxed beef prices helped support the futures market despite weakness in the stock market and strength in the dollar index. Choice beef prices were up $1.52 and select cuts were $2.21 higher on Monday and were up further at midday. While packer margins remain deeply in the red, the improvement in beef prices could help support the cash market again this week as market ready cattle supplies remain tight. February ended $1.20 higher at $125.80 and April was $1.00 higher at $129.18.
Lean hog futures closed mixed on Tuesday. Front end contracts were pressured by profit-taking on the recent rally. The 37 cents decline in pork cutout values on Monday, strength in the dollar and weakness in equity markets were also bearish factors. Deferreds were mixed with some spillover support from cattle futures. February ended 45 cents lower at $86.03 and April was 65 cents lower at $87.85.