Corn futures extended their moderate losses from Tuesday’s WASDE report in early-Wednesday trading. Those then seemed to increase in the wake of an announcement that a large South Korean firm had made a large purchase of South American and South African corn and excluded product from the U.S. This news apparently renewed concerns among domestic traders that greatly elevated quotes for North American product are strangling export demand. Concurrent losses in soybeans due to improved South American weather may have added to the downward pressure. March corn had slipped 6 cents to $7.22/bushel in late-morning trading, while the December 2013 future was down 2 1/2 cents at $6.25 1/4.
After having recently performed relatively well in response to excessive rainfall over sizeable portions of Argentine growing areas, soybean futures may have been vulnerable to a change in the weather. Today’s trading seemed to bear this out, since forecasts for near ideal conditions over Brazil and Argentina over the next two weeks were followed soon thereafter by significant losses in CBOT soybean futures. Follow-through wheat losses in reaction to the WASDE report may also have weighed upon the soy complex. January soybeans were down 6 to $14.66/bushel, while had fallen 0.34 to 49.86 cents/pound and January meal had dipped $0.6 to $447.5/ton by late morning.
The wheat market seemed to feel the persistent influence of Tuesday’s bearish WASDE report, since the data had negative implications for both the domestic and global markets. Talk of spreading strikes at various U.S. ports seemingly had little impact, since grains and soybeans usually aren’t shipped in containers. Ideas that the U.S. winter wheat crop will be quite vulnerable to winter kill during the coming weeks may be supporting the market, but that hasn’t appeared at all obvious lately. March CBOT wheat fell 4 1/4 cents to $8.17 1/4 per bushel in early trading; March KCBT wheat was down 8 1/2 to $8.73 and March MGE futures had slid 3 1/2 $9.07 1/2.
After surging in response to wholesale price gains Tuesday, live cattle futures seemed set to build upon the advance today. However, that was not the case, as exemplified by the most-active February contract reversal after failing to top the previous high in early trading. One has to wonder if the fact that Monday’s large deliveries (115 lots) were retendered rather than being kept or demanded by packers. In addition, having so many reclaimed (87 lots) suggests those deliveries could be hanging over the market during the days ahead. Choice cutout also slipped at noon, thereby suggesting Tuesday’s big jump was not the hoped-for start to a much larger advance. February cattle futures were trading 0.25 cents lower at 131.70, while the April contract had inched one tick higher to 135.55 cents/pound.
Wednesday morning news concerning the hog and pork complex didn’t seem particularly supportive, since both cash and wholesale quotes were down somewhat. The fact that the morning direct market quotes aren’t very reliable, probably reduced their influence, but late-morning news that heavy hams were called steady-to three cents lower was not friendly. The intra-day reversal suffered by live cattle futures probably weighed on the swine market as well. Projections for a substantial drop by the CME index seemed likely to depress Chicago prices as well. The fact that the nearby contracts had risen slightly in the face of these factors was impressive. Wire service sources cited expectations for tightening supplies in the New Year for the rise. February hogs rose 0.10 cents to 84.25 and June was up 0.10 at 99.15.