Crop markets turned decidedly lower Wednesday

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Rain seemed to sink the crop markets Wednesday. Although underlying demand strength has played a sizeable role in boosting corn prices lately, persistent dryness over the central U.S. has also encouraged new crop buying. Thus, current rains across the south-central U.S. and forecasts for more of the same apparently boosted production prospects and weighed upon prices. May corn fell 11.75 cents at $4.9575/bushel late Wednesday, while December declined 8.5 to $4.97.

The soy complex reversed from early highs. Talk of domestic supply tightness pushed soybean futures higher Tuesday night, with oil values actually leading the way upward. However, ongoing rains and forecasts for more of the same over the next two weeks seemingly caused a midmorning reversal. Technical selling probably exaggerated the late breakdown. May soybeans dropped 22.25 cents to $14.6225/bushel at their Wednesday close, while May soyoil sank 0.55 cents to 40.85 cents/pound, and May soymeal slumped $6.2 to $476.5/ton.

Improved weather forecasts also appeared to depress the wheat markets. Significant portions of the central U.S. got rain last night and more precipitation is expected later in the day. When combined with the potential for good rains by mid-month, it wasn’t terribly surprising to see wheat futures suffering another round of losses today. May CBOT wheat futures plunged 16.0 cents to $6.6925/bushel in late Wednesday action, while May KCBT wheat futures dove 14.75 cents to $7.3875 and May MWE futures tumbled 13.0 cents to $7.2225.

Cattle futures firmed after lunch Wednesday. After rising modestly Tuesday night despite weak wholesale news that afternoon, CME cattle prices turned mixed this morning. Traders are apparently worried about seasonal weakness from this point. However, beef prices had firmed when the noon report was released, which in turn seemed to power modest gains by most contracts. June cattle futures close up 0.30 cents to 136.77 cents/pound Wednesday, while December gained 0.27 to 140.27. Meanwhile, May feeder cattle jumped 1.20 cents to 177.97 cents/pound, and August ran up 1.20 to 179.57.

Suspicions of a looming top may have depressed hog futures. The hog and pork complex has exhibited astonishing strength lately, with sharp production cuts being met by apparent panic buying from processors and grocers. However, the bull run may be close to ending, as seemingly implied by the big losses suffered by CME futures today. June hog futures plummeted 2.80 cents to 124.80 cents/pound as pit trading ended Wednesday, but December moved up 0.25 to 91.40.

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