Corn futures reacted sharply to the USDA reports. The USDA’s Crop Production figure, at 13.763 million bushels fell well short of pre-report estimates averaging 13.98 billion bushels. The ending stocks figure on the WASDE report also fell significantly, so it was not at all surprising to see corn futures reverse early losses. September corn climbed 4.5 cents to $4.7025/bushel soon after the data were released Monday, while December gained 5.25 cents to $4.5825.
The soy complex built upon sizeable pre-report gains. Soybean futures rallied strongly after an early Monday morning report of sizeable buying from China. Prices followed through upon the early gains after the late-morning USDA reports, which stated the forthcoming crop below expectations, although the gains may have been limited by the relatively modest downward revision to expected ending stocks. September soybeans leapt 21.5 cents to $12.40/bushel soon after the Monday reports, while November beans soared 29.25 to $12.1125. September soyoil advanced 0.64 cents to 42.14 cents/pound, while September soymeal zoomed up $5.7 to $396.3/ton.
The wheat also responded well to the USDA data. Despite that fact that the USDA left its U.S. production estimates unchanged, wheat futures rallied Monday. Increased usage forecasts and lower forecasts for 2013/14 ending stocks encouraged buying, as did concurrent corn and soybean gains. September CBOT wheat edged up 1.0 cent to $6.345/bushel late Monday morning, while September KCBT wheat rallied 2.5 cents to $6.9975, and September MGE futures surged 5.0 cents to $7.37.
Cattle futures surged in response to Friday’s cash strength. Cash cattle prices posted a surprising $2.00/cwt gain last Friday afternoon. After having seen country values prove unable to rebound from summer lows from weeks, CME futures traders reacted quite strongly to that news Monday morning, especially since they probably expect more of the same during the days and weeks ahead. October cattle climbed 0.75 cents to 127.62 cents/pound in late Monday morning action, while December added 0.77 cents to 129.57. September feeder cattle futures gained 0.10 cents to 157.57 cents/pound, but November slid 0.37 cents to 160.00.
Lean hog futures rallied in concert with cattle Monday morning. The underlying strength implied by Friday’s cash cattle rally and the bullish response by CME prices, seemingly spilled over into the hog pit Monday. The fact that pork cutout also rose substantially last Friday despite a decline in fresh pork belly values probably encouraged buying as well. October hog futures jumped 1.10 cents to 86.07 just before lunchtime Monday, while December advanced 0.80 cents to 82.85.