The crop markets seemed to suffer a bit a bearish hangover after the May contracts expired Tuesday. Strong U.S. dollar gains may also be depressing commodity values. In addition, the accelerating pace of new crop plantings seemed to weigh upon the Midwest markets, even though the improved weather was widely anticipated. Corn futures dipped slightly in overnight trading. July corn slipped 1.75 cents to $6.5075/bushel early Wednesday morning, while December slid 2.25 cents to $5.3575.
The soybean market also came under moderate pressure in early morning trading, possibly due to ideas that timely corn plantings would mean the same for soybeans across the Corn Belt. Conversely, a respected Chinese think-tank reportedly forecast Chinese soybean imports during the 2013/14 crop year at a record 66 million tonnes, which would represent an 11.9% annual increase. Palm oil weakness also seemed to weigh upon soyoil prices. July soybean futures fell 5.0 cents to $14.0975/bushel in early Wednesday morning action, while July soyoil sank 0.22 cents to 49.54 cents/pound, and July soybean meal lost $1.9 to $409.9/ton.
The wheat markets also proved surprisingly weak overnight. Improved weather conditions and speedy plantings may be weighing upon prices, but the surging value of the dollar, which raises the cost of American products on the international markets may also be playing a role in the decline. July CBOT wheat futures dropped 4.25 cents to $7.065/bushel as the sun rose over Chicago Wednesday, while July KCBT wheat descended 5.0 cents to $7.62, and July MGE futures skidded 2.5 cents to $8.0875.
Cattle traders continue expecting seasonal weakness during the coming weeks, since slaughter rates are on their way to annual highs in early summer. Moreover, grocery industry demand for beef probably slows after Memorial Day. The latest burst of U.S. dollar strength does not help export prospects either. Still, bullish traders and feedlot managers are unlikely to lower their expectations after choice cutout set a new record Tuesday afternoon. June cattle edged downward 0.10 cent to 120.67 cents/pound in early Wednesday electronic action, while December slid 0.12 cents to 125.25. Meanwhile, August feeder cattle futures tumbled 0.37 cents to 146.05 cents/pound, while November slumped 0.47 cents to 151.07.
Hog traders rallied strongly Tuesday in response to talk of rising cash prices and a big midsession surge in pork cutout values. However, while afternoon reports confirmed the cash strength, day-ending pork quotes were much weaker than at noon, which very likely limited the follow-through strength seen early Wednesday morning. June hog futures rose 0.17 cents to 92.77 cents/pound overnight, while December futures added 0.22 cents to 78.12.
Cotton futures apparently surged in response to concerns about delayed U.S. plantings Tuesday, with bulls also get a significant boost from record readings for U.S. stock indexes. However, the U.S. dollar has also been climbing and posted a fresh advance overnight. The implied increase in the dollar value of U.S. commodities tends to slow sales on the international market, which probably explains the cotton weakness experienced overnight. July cotton declined 0.65 cents to 86.27 cents/pound early Wednesday morning, while December fell 0.83 cents to 85.33.