Livestock, cotton futures outperformed other ag markets Tuesday

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Slow planting progress is still supporting the corn market. The Monday afternoon USDA Crop Progress report showed spring corn plantings running well behind seasonal norms. Ideas that wet, cool weather will tend to limit or delay plantings seemed to offer persistent support this morning. May corn gained 3.5 cents to $4.92/bushel by late Tuesday morning, while December rose 3.0 to $4.93.

Trade talk undercut the soy complex. After posting surprising gains overnight, soybean and product futures turned decisively lower this morning. Wire service reports blamed talk of increased bean imports from South America, as well as the potential for big Chinese cancellations of previously scheduled U.S. deliveries. May soybeans dove 14.0 cents to $14.8475/bushel around midsession Tuesday, while May soyoil sank 0.22 cents to 42.78 cents/pound, and May soymeal lost $4.2 to $481.5/ton.

Weather forecasts may be weighing on the wheat markets. Although Monday’s Crop Progress seemed modestly bullish for wheat prices, those also turned lower Tuesday morning. The reversal probably stemmed from persistent talk of more favorable moisture conditions over the Great Plains during the days ahead, which rather obviously would favor a larger U.S. crop and lower prices. May CBOT wheat futures slid 2.5 cents to $6.6575/bushel in late Tuesday morning action, while May KCBT wheat futures skidded 0.5 cent to $7.335, and May MWE futures slipped 0.5 to $7.14.

Cattle traders may be expecting cash firmness. CME live cattle futures have moved generally higher today. The Chicago strength reportedly reflects Monday’s big bounce in beef cutout values, as well as sizeable discounts already built into CME futures. If beef strength causes packers to pay even steady-firm cash prices later this week, spring-summer futures could start looking underpriced. June cattle futures surged 0.87 cents to 135.42 cents/pound just before lunchtime Tuesday, while December rallied 0.82 cents to 140.50. Meanwhile, May feeder cattle ran up 0.72 cents to 178.82 cents/pound, and August advanced 0.70 to 182.60.

Hog traders are apparently anticipating seasonal strength. Hog and pork supplies are declining on a seasonal basis, so traders are starting to look forward to potential gains as buying for grilling season improves. Bears suspect prices are still too high to be justified by current fundamentals, but bulls are winning the pricing argument today. June hog futures bounced 0.62 cents to 122.97 cents/pound by late Tuesday morning, while December climbed 0.92 to 88.92.

An attaché report may be boosting cotton futures. The weekly Crop Progress report stated current cotton plantings at a very slow pace, particularly in Texas and across the Southeast. That is probably supporting new crop futures, but the nearby contracts are likely reacting to a report from the USDA attaché in Australia, who indicated that that country’s 2014/15 production and export totals could fall 5% below year-ago rates. May cotton climbed 0.93 cents to 90.62 cents/pound just before midday (EDT) Tuesday, while December cotton rose 0.29 to 82.28.

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