USDA data had mixed effects upon ag markets

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The USDA reports issued Thursday affected corn futures only slightly. The yellow grain market proved surprisingly weak despite the morning background of surging equity values and a declining dollar. The supportive results on the weekly USDA Export Sales report seemingly sparked little buying as well. That didn’t change after the monthly WASDE report, since the indicated numbers were rather mixed. September corn futures rose 0.75 cent to $5.545/bushel around midday Thursday, while December slipped 1.75 cents to $5.1975.

Soybean futures responded bearishly immediately after the WASDE report came out Thursday morning. The July projection for the new crop ending stocks at 295 million tonnes, was 30 million bushels more than analysts’ average estimates. The higher stocks figure reflected the new crop harvest estimate at 3.42 million bushels. The August soybean future gained 4.75 cents to $14.695/bushel late Thursday morning, while August soyoil dipped 0.32 cents to 46.69 cents/pound, and August soybean meal jumped $7.1 to $456.8/ton. November soybean prices slid 1.5 cents to $12.8325 /bushel.

Wheat futures rallied prior to the release of the WASDE data. The weekly Export Sales report proved quite supportive of the golden grain outlook, since the stated result for 2013-14 U.S. wheat sales, at 1.473 million tonnes, easily topped expectations in the 650,000-900,000 tonne range. Talk that the winter wheat harvest is nearing completion also encouraged traders. The WASDE report also encouraged bulls, since the USDA cut the 2013/14 carryout despite boosting its estimate of domestic production. September CBOT wheat climbed 6.75 cents to $6.8575/bushel by late Thursday trading, while September KCBT wheat advanced 6.75 cents to $7.1575 and September MGE futures surged 5.0 cents to $7.7375.

Cattle futures firmed response to the financial markets. U.S. cattle and beef production will probably be declining in a predictable seasonal manner during the coming weeks. As a consequence, any big shifts in forthcoming demand could significantly affect prices. Both the equity market strength and U.S. dollar weakness seen Thursday morning seem very supportive in that regard. Thus, cattle futures were trading around unchanged levels despite current wholesale weakness. August cattle were unchanged at 122.07 cents/pound just before lunchtime Thursday, while December slipped 0.07 cents to 128.37. August feeder futures lifted 0.42 cents to 150.97 cents/pound, and November gained 0.15 cents to 156.15.

Hog futures were weak Thursday morning. After pushing futures strongly higher Wednesday, the big wholesale price drop indicated on the late-afternoon pork reports undercut prices this morning. Discounts built into Chicago prices could limit losses, especially if the CME index continues its stable performance of the past two weeks. August hog futures lost 0.15 cents to 95.55 cents/pound in early Thursday electronic trading, while December skidded 0.32 cents to 81.72.

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