Crop futures rallied Wednesday, but livestock markets fell

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Big ethanol production may have boosted corn prices Wednesday. Corn futures bounced from fresh five-month lows yesterday and remained strong overnight. Bulls were probably pleased as well by the weekly EIA report stating last week’s ethanol production at a record high (due to rising gasoline prices). That implies robust corn demand. July corn gained 2.75 cents to $4.415/bushel in late Wednesday trading, while December stalled at $4.395.

News of a sizeable export sale likely supported nearby soy futures. Despite recent talk of reduced bean demand, the USDA announced this morning that 140,000 tonnes of 2013/14 beans had been sold to an unknown destination. Resurgent palm values are boosting the oil market, but new crop prices appear to be suffering from expectations for a big fall crop. July soybeans rebounded 10.75 cents to $14.09/bushel as Wednesday’s CBOT pit session ended, while July soyoil ran up 0.45 cents to 40.13 cents/pound, and July soymeal lifted $2.5 to $453.2/ton.

Kansas harvest data probably sparked wheat gains. An early report from the Kansas Wheat Commission indicated low yields and harvester problems with short stalks and mud. That news very likely powered today’s sizeable Kansas City rally, as well as more moderate gains at the Chicago and Minneapolis exchanges. July CBOT wheat futures climbed 5.25 cents to $5.87/bushel at Wednesday’s close, while July KCBT wheat jumped 15.25 cents to $7.2775 and July MWE futures surged 13.5 to $6.9725.

Bearish seasonal expectations seemingly depressed cattle futures. The Chicago cattle market seemed to lose its upward momentum Tuesday as traders anticipated traditional early-summer price weakness. Soaring beef supported prices overnight, but bears returned in force today. August cattle settled 0.70 cents lower at 145.02 cents/pound Wednesday afternoon, while December dove 1.57 to 149.22. Meanwhile, August and October feeder cattle future plummeted the daily 3-cent limit to 204.85 and 205.70 cents/pound, respectively.

Hog futures posted general losses despite supportive data. Tuesday’s cash and wholesale reports indicated across-the-board gains, but that seemingly did little to diminish the big losses posted in early CME action. Midday reports were less friendly, but futures bounced from early lows. That apparently reflected technical buying after futures held above chart support. August hog futures tumbled 0.95 cents to 127.45 at their Wednesday settlement, while December slumped 0.60 cents to 94.25.

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