Droughty weather news sent crop markets higher Tuesday morning
Corn futures rallied in concert with soybeans Tuesday morning. Weekend heat and persistent dryness seemingly bode ill for the forthcoming corn harvest. Still, a substantial portion of the gains posted in overnight trading probably represented spillover from soaring soybean prices. September corn jumped 8.75 cents to $5.0375/bushel early Tuesday morning, while December surged 8.5 cents to $4.905.
The soy complex spiked to start this week’s trading. Surprisingly high weekend temperatures exacerbated the lack of Corn Belt rain received lately, which very likely reduced production prospects for the fall soybean crop. Weather forecasts also implied little relief in the near future. Bean and product prices leapt in response. September soybeans rocketed 40.0 cents higher to $14.64/bushel in early Tuesday trading, while November beans zoomed up 45.5 to $14.03. September soyoil climbed 0.23 cents to 44.12 cents/pound, and September soymeal climbed $20.1 to $488.3/ton.
Wheat futures followed beans and corn higher in early Tuesday action. There was little substantive news concerning wheat over the weekend. That fact may have limited the gains posted by the various wheat markets as they followed the corn and soybean markets higher, since those gains suggest wheat and its products will be more competitive during winter and spring. September CBOT wheat gained 5.25 cents to $6.485/bushel around dawn Tuesday, and September KCBT wheat rose 4.5 cents to $7.0525, while September MGE futures were steady at $7.2025.
Cash action kept cattle futures from moving far last Friday. Cattle futures fluctuated Friday in response to sliding beef prices and conflicting reports concerning cash market action as the day passed. Ultimately, disappointing results in the Panhandle markets caused a generally weak close. Feeders are likely to drop sharply in reaction to resurgent soy and grain costs. October cattle futures settled 0.17 cents lower at 126.80 cents/pound last Friday afternoon, but December gained 0.22 cents to 130.47. September feeder cattle futures bounced 0.70 cents to 156.92 cents/pound, while November surged 0.95 to 159.72.
Hog traders seemingly reacted to reduced production totals late last week. Friday afternoon slaughter totals seemingly confirmed late talk of another significant decline in the weekly hog kill, which in turn suggested current supplies are surprisingly low. However, wholesale losses around 2.0 cents/pound late Friday afternoon may bode ill for today’s early action. October hog futures climbed 0.30 cents to 87.62 cents/pound at the Friday settlement, while December advanced 0.45 cents to 84.75.
Cotton futures posted modest gains in early Tuesday trading. Those almost surely reflected the strength spilling over from the Midwest markets. However, the fact that the nearby contracts bounced from multi-month lows and closed higher last Friday very likely reflected renewed technical strength, so bulls are probably looking for more of the same this week. December cotton futures rallied 0.39 cents to 83.88 cents/pound just after sunrise Tuesday, while March added 0.23 cents to 82.97.