Cattle market led the ag markets generally higher Thursday

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Corn futures rose modestly Thursday. After declining over the five previous sessions, corn futures seemed due for a bounce. Old crop tightness apparently supported the nearby September future, but deferred contracts may once again have suffered from fresh selling in reaction to favorable new crop conditions. September corn closed up 5.25 cents at $4.735/bushel Thursday, while December edged up 1.5 cents to $4.5975.

The soy complex also rallied in Thursday trading. As with corn, old crop tightness seemed to support nearby futures. The new crop contracts also rose, with optimism about the export outlook apparently playing a substantial role in the bean and meal gains. Oil prices moved slightly higher, although ongoing industry crushing of beans for meal probably damaged vegetable oil values to some extent. September soybeans jumped 28.75 cents to $12.2775/bushel late Thursday morning, while November beans surged 18.5 cents to $11.8425. September soyoil added 0.01 cents to 41.75 cents/pound, while September soymeal advanced $15.6 to $392.6/ton.

Wheat futures proved unable to sustain their Wednesday night bounce. After rallying along with corn and beans in overnight action, the golden grain markets generally dipped to fresh lows Thursday. Prospects for large U.S. crops this fall, as well as the ongoing shutout of U.S. sellers by cheaper international competitors appeared to undercut prices. September CBOT wheat slipped 2.25 cents to $6.4125/bushel late Thursday afternoon; September KCBT wheat bucked the bearish trend by rising 3.0 cents to $7.02, but September MGE futures slid 2.75 cents to $7.335.

Cattle futures backed away from overnight highs. Cattle prices leapt in response to news that Tyson foods will not accept slaughter cattle fed the feed additive Zilmax after September 6 due to lameness problems. However, questions about the extent of the ban and whether other packers would follow suit apparently caused a Thursday setback. October cattle settled ‘just’ 2.40 cents higher at 127.07 cents/pound Thursday afternoon, while December jumped 1.65 cents to 128.87 to end the day. September feeder cattle futures soared 1.45 cents to 157.82 cents/pound, and November leapt 1.18 cents to 160.70.

Lean hog futures traded firmly Thursday. CME swine futures followed the cattle market higher overnight, with traders apparently thinking a cattle surge would exaggerate the strength exhibited by the cash and wholesale markets lately. The subsequent setback toward unchanged levels suggests diminished confidence, especially with western Corn Belt prices called lower around midday. October hog futures ascended 0.33 cents to 85.25 at the end of the day, while December ran up 0.47 cents to 82.15.

Cotton futures built moderately upon their Wednesday breakout Thursday. Talk of increasing dryness in Texas and China may be playing a major role in the ongoing ICE advance. However, the fact that nearby futures had been confined to a very narrow range in recent weeks apparently exaggerated the initial surge. October cotton futures climbed 0.85 cents to 89.38 cents/pound at its afternoon settlement, while December lifted 0.92 cents to 89.25.

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