Grain markets mixed on Thursday

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Corn futures continued their recent decline again Thursday, with the weekly Export Sales figure apparently doing well to meet weak industry expectations. The USDA stated the net result at 160,400 tonnes in the lower third of pre-report forecasts and well below the preceding weekly figure. Having Brazil boost its forecast for its domestic harvest probably depressed prices as well. March corn fell 12.25 cents to $7.1075/bushel Thursday afternoon, while December dropped 11.50 cents to $5.665.

Soybean futures proved generally mixed Thursday. Strong export sales for 2012-13 delivery probably boosted the nearby contracts for beans and products. However, weaker prospects for 2013-14 shipment may have undercut deferred futures, especially with the looming South American harvest promising to flood the market by the second quarter. March soybeans had inched 0.75 cent lower to 14.87 at the Thursday close, while March soyoil fell 0.60 cents to 51.85 cents/pound, while March meal edged upward $0.5 to $437.6/ton.

The Thursday morning Export Sales report stated the net weekly wheat total at 300,800 tonnes, which essentially matched the lower end of industry forecasts. That result seemingly depressed wheat futures later in the morning, although traders would very likely point to concurrent losses in corn and deferred soybean futures as well. Slightly improved forecasts for Southern Plains moisture may have exerted additional downward pressure. March CBOT wheat futures settled 5.50 cents at $7.56/bushel Thursday, while March KCBT wheat slumped 8.25 cents to $8.01 and March MGE futures lost 5.0 cents to $8.3925.

Nearby February cattle futures increased slightly Thursday, which probably reflected general industry expectations for a rise in cash values later this week. However, the market consensus seems much less favorable toward spring-summer prospects in the wake of recent wholesale losses. Put simply, beef packers may prove less than willing to pay up for fed cattle if beef values do not rebound substantially from recent losses. That seems especially true with Cargill closing a Texas plant at this time. April cattle edged 0.02 cents lower to 131.52 cents/pound at the Thursday close, while August skidded 0.52 cents to 127.57. Meanwhile, March feeder cattle sank 0.35 cents to 147.20 cents/pound and August tumbled 0.47 cents to 158.95.

Hog futures also were mixed Thursday. The nearby contracts moved slightly higher due to their discounts to the CME lean hog index (which futures cash-settle against). However, the early-week breakdown in fresh pork values, especially the losses suffered by pork bellies and loins, kept downward pressure upon the deferred contracts. This may continue until traders believe wholesale prices have stabilized. April hogs closed 0.27 cents higher at 86.52 cents/pound, but June lost 0.55 cents to 94.60.

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