Friday morning USDA reports roiled ag markets

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Corn futures closed lower Friday. The USDA acreage report on corn obviously turned out to be a big surprise to a large number of people. The actual planting at 97.38 million acres exceeded analysts’ average estimate by more than 2 million acres. This definitely added a great deal of selling pressure to the CBOT market. September corn futures dove 25 cents to $5.4725 per bushel at closing time Friday afternoon, while December corn plunged 20 cents to $5.11 per bushel.

Soybean futures followed their counterparts and reacted poorly as well Friday. Although soybean futures struggled to avoid sustained loses, downward pressure from other commodities dominated trading. Actually, the USDA reports on soybean acreage and stocks were fairly close to the average forecasts, which provided underlying support for the market. That was exemplified by the sizeable gains posted by the expiring July contracts. August soybean future dipped 1.5 cents to $14.31 /bushel as trading ended for the week Friday afternoon. August soyoil skidded 0.06 cents to 46.29 cents/pound, and August soybean meal declined $0.3 to $434.9/ton. November soybean prices plummeted 23.25 cents to $12.52/bushel.

Wheat futures were also very negatively impacted by the reports on Friday. In addition to the breakdown of corn futures, the planted acreage totals far exceeded the average of pre-report estimates. The expected summer harvest weighed on the market regardless of the support from tight June 1 stock supplies. September CBOT wheat fell 16 cents to $6.5775/bushel, while September MGE wheat futures declined 8 cents to $7.7475/bushel, while September KCBT wheat tumbled 11.5 cents to $6.9050/ bushel.

Cattle futures gave back recent gains Friday. Traders have recently suspected cattle prices were near their 2013 lows, but news of weak cash trading in the early afternoon undercut CME prices once again. Flat midsession readings for the wholesale market did not help either. Indeed, the limit-down close by the June contract as it expired may bode ill for the short-term outlook. August cattle fell 0.90 cents to 122.02 cents/pound at its Friday close, while December sank 0.34 cents to 127.80. Feeder futures were supported by the report-driven corn breakdown. August feeders settled 0.25 cents lower at 149.45 cents/pound, while November slipped 0.15 cents to 154.50.

Hog futures turned decisively lower Friday. Morning reports of cash weakness probably reinforced pessimism created by the Thursday afternoon pork reversal. Traders apparently became much more concerned about the summer outlook as a consequence. They know the hog and pork complex often declines after Independence Day. The afternoon USDA Hogs and Pigs report also seemed rather bearish for nearby futures Monday morning. August hog futures dove 1.95 cents to 97.45 cents/pound late Friday afternoon, while the December contract plunged 1.05 to 82.65.

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