The weekly Export Sales report seemed supportive of the short-term corn outlook, since the 253,400-tonne total came in toward the upper end of forecasts in the 150,000-300,000 tonne range. That seemingly enabled futures to rebound from overnight lows toward unchanged levels around mid-morning. Bulls were also point to firming cash quotes across the Midwest, arguing that ethanol industry demand is improving. However, weather news reemerged as the driving factor affecting crop futures later in the morning, since the latest forecast models imply the pressure ridge previously expected to dominate the skies over Southern Brazil and Argentina now looks likely to form over Chile or the Eastern Pacific. The resulting improvement in precipitation prospects for South America apparently stifled rally attempts by corn and soybean futures during the balance the CBOT session. March corn ended Thursday 1/4 cent higher, at $7.40 1/2, while December fell 3 cents to $5.91/bushel.

The Export Sales report for the soybean complex might easily have been construed as being moderately bullish, since strong bean sales probably more than offset weak product totals. The USDA stated the weekly sales figure at 1.253 million tonnes, whereas pre-report forecasts had peaked at 850,000. However, soybean traders were diverted by the latest results of the major weather models, which suggested recent worries about emerging South American dryness were overdone. That is, the high pressure ridge previously expected to block rainfall over the corn and soybean growing areas of Southern Brazil and Argentina will apparently form well to the west, thereby opening the door to precipitation over that region. The soy complex fell rather substantially as a consequence. March beans closed 10 1/4 cents lower at $14.68 1/2 per bushel Thursday and March meal sagged $6.3 to $426.7/ton, but soyoil rose 0.26 cents to 52.86 cents/pound.

Although the winter wheat situation still seems rather dire at this juncture, the USDA Export Sales report apparently caused traders to forget those conditions for the moment. It stated the weekly sales total at 387,900 tonnes, whereas traders were expecting something between 350,000 and 550,000 tonnes. The result was not that bad when viewed in that context, but it looks rather poor when compared to the previous weekly total (at 647,500). That news, along with the midsession losses in the corn and soybean markets and technically inspired selling reportedly dragged wheat futures downward as well. March CBOT wheat futures settled 7 1/2 cents lower at $7.79 1/2 per bushel Thursday afternoon, while March KCBT wheat dropped 3 cents to $8.37 3/4 and March MGE futures dipped 5 cents to $8.65.

Cattle futures posted a surprisingly weak reaction to Wednesday morning news of cash trading 3 cents higher than benchmark levels reached last week. Still, given the persistent strength exhibited by the cattle/beef complex since late 2010, CME traders were probably prepared to push nearby futures significantly higher. We tend to blame persistent wholesale weakness for their inability to do so, especially after seeing the decline suffered Thursday. The fact that fed cattle exiting feedlots outweigh their counterparts from early 2012 by over 20 pounds/head may also be playing a role in the ongoing futures weakness, since that increases beef production commensurately and suggests market-ready supplies are relatively plentiful. Whatever the cause, a market that cannot rally on good news often proves vulnerable to larger losses, which may bode ill for the late-winter outlook. February cattle dropped 0.37 cents Thursday and closed at 127.62 cents/pound. April slipped 0.12 cents to 132.80.

Direct hog markets surged rather substantially Thursday, thereby encouraging CME swine traders confounded by their inability to sustain advances through much of late January. Bulls may also have been reacting to talk of belated ham strength. That is, the leg muscle market had recently proven rather flat in the wake of its big holiday breakdown. However, grocers may finally have begun buying hams for planned features for Easter weekend sales, since hams were called 3 cents higher on the midday USDA pork report. A sustained seasonal advance could do a great deal to boost hog prices as well. Bears can reasonably point to concurrent beef weakness as potentially capping hog and pork gains, but having the February post its best-ever close suggests bullish momentum is building. February futures surged 0.50 cents to 87.60 cents/pound Thursday afternoon, while June edged just 0.07 cents higher to 98.10.