Grain markets stage modest recovery

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Corn futures for the 2012/13 crop year closed a little higher on Wednesday. After a sharp decline following USDA’s Crop Production report, corn futures attempted to bounce back. Firming cash prices gave futures a firmer tone. Farmer selling has dried up on the price decline and commercials are anxious to get corn in position to move into export channels in anticipation of improved demand later this winter. Dry weather in Argentina should help facilitate planting progress. December corn futures were 2 1/4 cents higher at $7.25 3/4.

Soybean futures closed mostly higher on Wednesday. The January futures advanced for the second consecutive day. At the close, January was up 11 cents at $14.19. New-crop November of 2013 lost 6 3/4 cents at $12.75 1/4. December soybean meal gained $2.90 at $436.00. Soyoil rebounded 65 points to close at 47.67 cents for December. The market was greeted with fundamentally bullish news this morning. USDA said China was the buyer of 120,000 tonnes of soybeans and there was a very large soybean oil sale totaling 40,000 tonnes. Additionally, the monthly NOPA crush was about 5 million bushels more than trade expectations.

Futures closed only mixed, with CBOT futures closing lower and KCBT and MGE closing slightly higher, but well off the day’s highs. Futures opened with a nice bounce, but then had a hard time holding on to early gains after last evening’s weekly crop condition report showed winter wheat conditions dropping another 3 points, to just 36% rated “good” to “excellent.” It didn’t help when the holiday-delayed export inspections report came in at only 10 million bu., the low end of pre-report trade estimates for export inspections. We’re still seeing lingering bearish sentiment following last Friday’s surprising upturn in USDA’s global ending stocks forecast. At the close, CBOT December wheat was down 2 ¼ at $8.48 ¾; KCBT December up 2 at $8.89 ¾; and MGE December up 1 ¼ at $9.33 ¼.

Live cattle futures were lower on Wednesday. Cash bids are still undeveloped. Beef prices were mixed at midday. Cattle futures continue to consolidate in a fairly narrow trading range. The monthly Cattle on Feed report will be out on Friday. The report is expected to show a sharp decline in placements during October with cattle on feed down 4%-6% from a year ago. December CME cattle futures closed 37 cents lower at 125.42.

Lean hog futures closed lower. Cash hogs were steady to 50 cents lower in the west and 50 cents to a $1 lower in the east. Weakness in the stock market carried over into the hog market which is already under some pressure from lower pork values. December CME lean hogs settled 40 cents lower at $80.10.

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