Grain markets mixed Wednesday morning

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Corn futures apparently slumped on improving expectations for the 2013 U.S. crop Wednesday morning. The storms that swept across the Southern Plains in late February and those expected in early March are rather obviously increasing moisture availability in many crop growing areas, thereby encouraging optimism about the size of summer-fall crops. Traders also seem reluctant to sponsor fresh long positions ahead of the Friday morning release of the USDA WASDE report. May corn dipped 9.5 cents to $6.995/bushel late Wednesday morning, while December slid 4.25 cents to $5.4775.

Soybean futures were trading moderately higher after dipping early Wednesday. No readily apparent news was driving the increase, so traders are probably falling back upon the recent surge in export sales for guidance. They may also be looking for bullish adjustments to the supply/demand outlook on the forthcoming WASDE report from the USDA Friday morning. May soybeans had climbed 4.25 cents to $14.7075/bushel around mid-session Wednesday, while May soyoil edged 0.01 cents higher to 50.14 cents/pound, and May meal gained $2.1 to $438.0/ton.

The wheat market also seemed to suffer from persistent optimism about the size of 2013 crops Wednesday morning, especially with more precipitation forecast for the Southern Plains this weekend. As with corn and soybeans, traders are probably in the process of balancing positions ahead of the WASDE report Friday morning. We should also point out that bears are fighting against negative technical factors. May CBOT wheat futures had fallen 13.0 cents to $6.93/bushel by late Tuesday morning, while May KCBT wheat sagged 12.75 cents to $7.3225, and May MGE futures skidded 10.5 cents to $7.8525.

Cattle futures remained weak despite recent wholesale strength. The fact that choice cutout values had jumped over 10 cents/pound over the previous 10 days seemingly did little to encourage traders. They may have been anticipating late-morning news that a few Panhandle cattle were trading at 128 cents/pound, steady with last week. That almost surely disappointed bulls expecting a follow-through cash advance. April cattle slumped 0.50 cents to 129.12 cents/pound in late-morning activity, while August dipped 0.20 cents to 124.95. Meanwhile, April feeder cattle dropped 0.80 cents to 142.80 cents/pound, while August fell 1.10 cents to 151.90.

Hog futures rebounded from multi-month lows Wednesday morning. The early losses almost surely marked a reaction to widespread wholesale losses Tuesday, whereas the bound probably reflected the recent firming of country cash markets. Given the large losses suffered in recent weeks, CME prices could rise rather substantially during the days ahead. April hogs had risen 0.32 cents to 79.57 cents/pound late Tuesday morning, while June rallied 0.27 cents at 89.82.

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