Corn futures surged Friday in response to the USDA WASDE report, then continued the rise over the weekend. The industry was anticipating an increase in 2012/13 carryout stockpiles, so the fact that the USDA left the number unchanged was viewed as a signal of a tighter supply/demand situation than previously thought. May corn rose 4.0 cents to $7.075/bushel to start the week, while December gained 1.75 cents to $5.4875.
The WASDE report was viewed as moderately bearish for soybean futures last Friday; prices declined somewhat, but rebounded early Monday morning. There seemed to be no supportive news, so the latest advance was quite surprising. One has to wonder if forecasts for rain and snow over the Central U.S. during the days ahead were viewed as being too much of a good thing, since some areas of Missouri and Illinois reported modest flooding Sunday. May soybeans surged 9.0 cents to $14.80/bushel in pre-dawn trading Monday, while May soyoil gained 0.12 cents to 50.46 cents/pound, and May meal climbed $3.2 to $438.4/ton.
The wheat market was mixed to higher Sunday night, which seemed to reflect forces similar to those boosting corn and soybeans. Ultimately, hopes for persistent export demand strength during the coming weeks and months appear to be supporting U.S. wheat values. May CBOT wheat futures edged 2.25 cents higher to $6.9925/bushel, while May KCBT wheat was unchanged at $7.3425, and May MGE futures moved up 2.25 cents to $7.9425.
Cattle futures continued their recent decline Friday, which probably reflected disappointment with the flat cash prices (around 128 cents/pound) posted last week. The recent wholesale rally also appears to lose momentum. Meanwhile, pessimism about the cattle outlook seems to be undercutting feeder cattle rather badly. April cattle fell 0.75 cents to 127.55 cents/pound at their Friday afternoon settlement, while August dropped 0.97 cents to 124.27. April feeder cattle dove 1.27 cents to 141.35 cents/pound to end the week, while August sank 1.30 cents to 150.55.
Hog futures were decidedly mixed Friday. Early reports implying country market losses probably weighed upon nearby futures, as did weakness spilling over from the cattle pit. Traders seemingly had little reason to expect a reversal of recent pork declines either. The big cash market breakdowns reported late Friday afternoon seemingly bode ill for the start of trading this week. April hogs rose 0.22 cents to 82.02 late Friday afternoon, while June slipped 0.22 cents to 91.70.
The cotton market did not react particularly well to the bullish results of the WASDE report last Friday, which may explain the large losses suffered early Monday morning. There was no substantive news over the weekend. May cotton fell 0.91 cents to 85.97 cents/pound in early Monday electronic trading, while December lost 0.72 cents to 85.67.