Corn futures are expected to open steady to six cents higher. Corn prices were generally higher overnight. Soybean prices are leading the market, pulling corn and wheat prices along for the ride. There is still good commercial demand for old crop corn, but noncommercial interest is sluggish. The market could establish a short-term technical signal if July closes above $6.07. Another bout of cold weather may cause some problems in northern areas of the Corn Belt over the weekend.
Soybean prices are expected to open about 8 to 14 cents higher on Friday. The outlook for the soybean sector is growing even more bullish with strong export sales and shipments reported in the Thursday report. Exports from, Brazil and Argentina are slower than normal and traders continue to debate how much exports from the two countries will be down this spring and summer. The July contract is within just a few cents of the $15 benchmark.
Wheat prices are called steady to 3 to 5 cents higher. Wheat prices have worked steadily higher over the past week and the July Chicago contract is up nearly 20 cents over that period. The wheat market is benefitting from the gains in other markets, especially soybeans. The annual winter wheat tour is scheduled for next week which will provide some insights into yield potential in the Plains states. With the advanced stage of development, the crop could be vulnerable to a late season frost.
Cattle prices are expected to open steady to 30 cents lower. Cash cattle trade picked up on Thursday with prices reported to be down about $2 from last week’s average. Futures market traders are still trying to sort out how much impact the case of BSE reported earlier this week will have on demand. Cattle weights remain far above year ago levels, but last week we did see a modest decline from the previous week.
Hog prices are expected to open steady to 30 cents lower. There was certainly no good news from the cash market on Thursday. Cash hog prices fell 85 cents per cwt and the pork cutout was down 12 cents. Both are very close to the lows for the year. There are few signs of hog supplies tightening, even though seasonally they do decline at this time of year. There is also no sign that the BSE problem in the cattle market is boosting demand for pork. The real question is how low can prices go?
Cotton prices are expected to open 10 to 30 points lower on Friday. The data in the export sales report on Thursday had a positive impact on the cotton market. Shipments will need to stay pretty high over the rest of the crop year to reach the current USDA total of 11.4 million bales. Cotton futures have moved into a sideways trading range with the July contract mostly between 90.5 and 93 cents per pound.