Surging cattle futures diverged from weak crop quotes Thursday

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Weather forecasts seemed to weigh on corn Thursday. Although the USDA Export Sales report indicated strong corn sales last week, yellow grain prices tumbled today. Sources blamed weak soybean numbers for general old-crop weakness and widespread bullish profit-taking, but talk of the potential for a planting window next week spurred new crop corn sales. July corn fell 12.0 cents to $5.07/bushel at Thursday’s close, while December lost 9.75 cents to $4.995.

The soy markets plunged on aggressive long liquidation. U.S. export commitments actually declined slightly last week; and while that wasn’t unexpected, CBOT traders seemingly saw that as a sign to abandon old-crop longs. Bulls seemed to panic as they headed for the exits. New crop prices also fell despite talk of accelerating corn plantings next week, which implies reduced bean seedings. July soybeans crashed 51.75 cents to $14.61/bushel in late Thursday trading, while July soyoil plummeted 0.95 cents to 41.16 cents/pound, and July soymeal plunged $17.0 to $476.7/ton.

Wheat futures suffered spillover losses. The current wheat situation appears less than promising, as reports from the Kansas wheat tour indicate. Forecasts for improved planting weather may have weighed on the Minneapolis market, but winter wheat fundamentals look bullish despite the unremarkable export report. Ultimately, it seemed as if widespread long liquidation weighed heavily upon wheat futures. July CBOT wheat futures dove 14.25 cents to $7.0725/bushel at their Thursday settlement, while July KCBT wheat futures dropped 8.5 cents to $8.04, and July MWE futures tumbled 7.5 to $7.6125.

Firm cash ideas seemed to spur cattle buying Thursday. Mixed wholesale quotes and bearish cash market expectations have generally weighed upon cattle futures this week. However, talk of a steady-firm result to this week’s cash trading appeared to spark across-the-board CME buying today. June cattle surged 2.05 cents to 139.25 cents/pound as Thursday’s pit session ended, while December soared 2.37 cents to 144.35. Meanwhile, August feeder cattle spiked 3.00 cents to 190.47 cents/pound, and October leapt 3.00 cents to 190.97.

Pork weakness appeared to depress hog futures. After opening weakly, CME lean hog futures appeared to rally in concert with cattle futures this morning. However, the midday pork reports indicated another big drop in wholesale values, which in turn weighed upon nearby swine futures. June hog futures closed 0.33 cents lower at 122.80 cents/pound Thursday, while December gained 0.90 to 93.40.


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