Grains set back modestly Wednesday night. Traders were apparently unwilling to take on fresh risk last night, since CONAB will release its Brazilian crop estimates later this morning and the USDA will follow with the monthly WASDE report tomorrow. Given the size of early-week gains, it wasn’t terribly surprising to see corn futures dip overnight. July corn stalled at $5.14/bushel early Thursday morning, while December declined 1.5 cents to $5.08.
Traders are probably evening soy positions ahead of the CONAB data. Soybean and product prices had recently dropped ahead of the widely anticipating Brazilian production data due for release this morning. Thus, last night’s apparent short-covering might have been expected. The weekly USDA Export Sales report is also looming this morning, with the WASDE report due tomorrow. July soybeans bounced 7.0 cents to $14.5325/bushel Wednesday night, while July soyoil advanced 0.17 cents to 41.00 cents/pound, and July soymeal gained $1.7 to $476.2/ton.
Diminished Black Sea tensions seemed to undercut wheat markets. Talk that Russian forces had pulled back from its Ukraine border yesterday afternoon seemed to reduce tensions in the Black Sea region. Bullish profit-taking ahead of the forthcoming crop reports probably spurred overnight selling as well. July CBOT wheat futures sagged 5.25 cents to $7.325/bushel in early Thursday action, while July KCBT wheat futures fell 6.75 cents to $8.3475, and July MWE futures tumbled 7.0 to $7.995.
Cattle futures firmed in the face of beef slippage Thursday morning. It isn’t unusual for beef prices to bounce as grocers buy for Memorial Day features, but wholesale values have declined this week. That apparently triggered selling by bears anticipating seasonally increasing supplies. Still, relatively tight feedlot numbers could limit the anticipated price drop already built into futures. June cattle inched up 0.10 cents to 137.67 cents/pound as Thursday dawned over Chicago, while December crept 0.07 cents higher to 144.27. Meanwhile, August feeder cattle rallied 0.35 cents to 191.02 cents/pound, and October added 0.20 cents to 191.72.
Cash and wholesale slippage discouraged hog market bulls. Bullish CME traders were probably looking for a Wednesday bounce in pork values after those plummeted Tuesday. The afternoon wholesale reports indicated mixed to lower prices, while cash hog values dipped. That news very likely caused the overnight Chicago decline. June hog futures slumped 0.42 cents to 120.75 cents/pound Wednesday night, while December dropped 0.57 cents to 94.22.
Cotton traders may also be awaiting data. Although it may not affect ICE futures a great deal, CONAB will also release its Brazil’s current cotton crop this morning. The forthcoming USDA markets probably have great potential to affect the fiber market. Thus, it would make sense for cotton traders to flatten their positions at this point. Futures were mixed after Wednesday’s big losses. July cotton began Thursday 0.02 cents lower at 92.65 cents/pound, while December cotton rose 0.11 to 84.02.