Weather and export news weighed upon grain and soy markets Monday morning. 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. May corn dipped 5.75 cents to $6.4675/bushel around midsession Monday, while December fell 13.0 cents to $5.34.
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. Talk of accelerated Chinese sales of canola oil depressed the palm and soy oil markets. May soybeans sank 17.75 cents to $14.105/bushel late Monday morning, while May soyoil dove 0.74 cents to 48.42 cents/pound, and May soybean meal slipped $4.3 to $408.1/ton.
Ideas that improving weather will boost production prospects for the U.S. wheat crop also weighed upon that market Monday morning. 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. In addition, China reportedly imported just 54% as much wheat during March as it did just one year ago. May CBOT wheat futures plunged 12.0 cents to $6.97/bushel just before lunchtime Monday, while May KCBT wheat tumbled 14.5 cents to $7.315 and May MGE futures lost 705 cents to $8.18.
As expected, cattle futures reacted poorly to the monthly USDA Cattle on Feed report published last Friday afternoon. However, the Chicago market had rebounded moderately from early lows, which may have reflected surprising wholesale market firmness. Indeed, weather forecasts for warmer U.S. weather in early May might be just the thing the meat industry needed to kick start the traditional spring grilling season, which could add up to much improved short-term demand for beef and pork. June cattle slid 0.35 cents to 120.95 cents/pound in late Monday morning action, while December declined 0.60 cents to 126.00. May feeder cattle futures skidded 0.35 cents to 138.85 cents/pound, whereas August edged upward 0.05 cents to 146.10.
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 early-week losses, especially since the cash equivalent price is declining. It will almost surely be quoted 0.23 cents lower at 81.09 cents/pound on Tuesday morning. May hog futures slipped 0.55 cents to 87.30 cents/pound around midday Monday, while the June contract lost 0.82 cents to 89.37.