Weather and export news weighed upon grain and soy markets Monday. Weekend forecasts indicate central U.S. weather could improve substantially next week, thereby potentially setting the stage for a big surge in plantings in early May. This seems particularly important for the corn crop. Chinese officials also reported Sunday night that its corn imports suffered a 50% annual decline during March. The weekly Export Inspections report largely met expectations for corn. May corn dipped 5.5 cents to $6.4575/bushel at the Monday close, while December fell 14.5 cents to $5.325.
Improved Corn Belt forecasts for next week also weighed upon soybean futures Monday, since a quick surge in corn plantings could translate into timely soybean plantings and increased production per acre at harvest. The reported 20% annual drop in Chinese soybean imports during March tended to undercut prices as well. Weekly export inspections fell short of forecasts, which did not help the bullish cause. May soybeans sank 10.25 cents to $14.1725/bushel Monday afternoon, while May soyoil dove 0.54 cents to 48.62 cents/pound, and May soybean meal slipped $2.1 to $410.0/ton.
Ideas that improving weather will boost production prospects for the U.S. wheat crop also weighed upon the markets Monday. That is, warmer and drier conditions could accelerate spring wheat plantings, while recent moisture may have raised the potential for the growing winter wheat crop. Some suggest potential frost damage is less severe. In addition, China reportedly imported just 54% as much wheat during March as it did one year ago. May CBOT wheat futures closed 6.75 cents lower at $7.0225/bushel Tuesday, while May KCBT wheat tumbled 6.5 cents to $7.395 and May MGE futures lost 6.75 cents to $8.1875.
As expected, cattle futures reacted poorly to the monthly USDA Cattle on Feed report published last Friday afternoon. And while firm choice beef prices seemed to offer some support, especially with warmer weather potentially boosting consumer demand, the market remained relatively weak throughout the CME session. The afternoon USDA Cold Storage report stated March 31 beef stocks at 513.2 million pounds, slightly above expectations; that may bode rather ill for the Tuesday morning opening. June cattle slid 0.47 cents to 120.82 cents/pound in late Monday morning action, while December declined 0.45 cents to 126.15. May feeder cattle futures skidded 0.60 cents to 138.60 cents/pound, and August edged downward 0.07 cents to 145.97.
Hopes for a seasonal demand surge did not seem very apparent in the hog pit Monday morning, with spring and summer futures sustaining moderate losses. The fact that they are trading at substantial premiums to the CME lean hog index probably accounts for a sizeable portion of their recent decline. However, the strong result of the midday pork report may have set the stage for gains during the days just ahead. May hog futures settled down 0.27 cents to 87.57 cents/pound Monday afternoon, while the June contract lost 0.65 cents to 89.62.