Crop markets mixed to start the week
Corn futures were mixed to higher to start the week.
Talk that a storm will hit the Corn Belt later this week, thereby hampering the corn harvest, seemed to support corn futures in Sunday night trading. A forecast of substantially reduced Russian grain may also be offering support. December corn futures were steady at $4.4325 early Monday morning, as was May at $4.645/bushel.
The soy complex proved surprisingly weak Monday morning. Most late developments, from talk of rainfall hampering the ongoing soybean harvest, reduced Russian grain production and weak Asian palm oil prices seemed to point to higher soy gains this morning. However, after rising Sunday evening, prices are weak this morning. We suspect anticipation of a big drop in the equity indexes sparked the soy complex selling. November soybeans sank 2.25 cents to $12.9275/bushel around dawn Monday, while December soyoil slid 0.06 cents to 40.18 cents/pound, and December soymeal sagged $0.4 to $418.0/ton.
After declining last Friday, wheat futures bounced over the weekend. Indications of strong demand have boosted wheat lately, but prices dipped last Friday. Futures rebounded Sunday night and Monday morning, thereby seeming to reflect a crop forecast out of Russia. That is, excessive rainfall has apparently curtailed Russian plantings, with the resulting drop in acreage pointing to a significant production figure next spring. December CBOT wheat rallied 2.75 cents to $6.8975 bushel in early Monday action, while December KCBT wheat bounced 3.25 cents to $7.535, and December MGE futures gained 3.75 cents to $7.50.
Wholesale strength probably boosted cattle futures last Friday. The cattle market is still feeling the lack of USDA data. Cash weakness had weighed upon prices around midweek, but a suspected surge in wholesale prices seemingly powered the Friday afternoon surge. That may also have set the stage for follow-through gains this week. December cattle futures jumped 0.65 cents to 132.42 to end last week, while April rallied 0.65 cents to 135.45. Meanwhile, November feeder cattle ran up 0.32 cents to 165.95 cents/pound, and January gained 0.55 cents to 165.95.
Hog futures posted an impressive advance at last week’s close. Again, the lack of USDA news is very likely limiting activity in the hog pit. However, as with cattle, prices surged just before midday Friday, which probably reflected strong wholesale and/or production news from private sources. December hog futures leapt 0.85 cents to 87.62 cents/pound as trading would down last Friday, while April surged 0.67 cents to 90.32.
Cotton dropped rather sharply this morning. We suspect Tropical Storm Karen is proving much weaker than many anticipated last week, so the Southeastern cotton crop may be in less danger than previously thought. Thoughts to that effect, along with expectations for a sharp drop in the equity indexes this morning probably explain the decline suffered by cotton futures in early trading. December cotton fell 1.19 cents to 85.99 cents/pound just after sunrise Monday, while March lost 1.09 to 86.04.