Most ag markets closed rather weakly Tuesday

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Corn futures reversed from early highs Tuesday. After leaping upward in response to droughty late-summer weather and forecasts for more of the same through early September, corn futures reversed sharply Tuesday. Wire service reports cited profit-taking for the drop, but traders may also have decided that recent gains have fully anticipated the bullish impact of the summer heat. September corn closed 3.0 cents higher at $4.98/bushel Tuesday, while December fell 6.75 cents to $4.7525.

The soy complex gave back major portions of early week gains. Anticipation of drought damage to the ongoing soybean crop almost surely powered the Monday night-Tuesday morning soy surge. However, the CBOT markets gave back major portions of those gains, although there were no obvious reasons for the reversal. Traders seemingly felt that recent gains had already incorporated the bullish weather into Chicago prices. September soybeans surged 11.5 cents to $14.355/bushel in late Tuesday trading, while November beans jumped 29.25 to $13.8675. September soyoil dipped 0.07 cents to 43.82 cents/pound, whereas September soymeal climbed $17.2 to $485.4/ton.

After rallying in concert earlier, wheat futures turned downward along with corn. As with corn, there was little supportive news concerning the wheat market Monday night, so both rose with soybeans. Conversely, wheat also proved vulnerable to the late-morning sell-off, which in turn may set the stage for larger short-term losses. September CBOT wheat dropped 6.75 cents to $6.3565/bushel as trading wound down Tuesday, while September KCBT wheat sank 4.0 cents to $6.9675, while September MGE futures plunged 16.5 cents to $7.0375.

Cattle futures proved surprisingly weak Tuesday afternoon. After posting early gains in anticipation of seasonal strength in early trading, cattle nearby cattle futures proved surprisingly weak later in the day. Their inability to overcome trendline resistance seemingly prompted the bearish reversal. October cattle futures lost 0.60 cents to 126.20 cents/pound at their Tuesday settlement, and December sank 0.37 cents to 130.10. September feeder cattle futures bounced 0.25 cents to 157.17 cents/pound on the corn drop, while November lifted 0.17 to 159.90.

Hog traders seemed cautiously optimistic about short-term price prospects. Although recent production shortfalls and seasonal patterns apparently point to firming cash and pork prices later this month, last Friday’s large cash and wholesale losses probably limited Tuesday’s gains. October hog futures settled 0.37 cents higher at 88.00 cents/pound Tuesday afternoon, while December edged up 0.22 cents to 84.97.

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