Weather concerns boost grain prices
Corn futures closed higher on Tuesday. Strength in beans and wheat provided upside leadership. The cash corn market is firm as farmers are tightly holding limited supplies. Shippers are closely monitoring Mississippi River water levels from St. Louis to Cairo, IL. Low water is likely to limit barge transportation. Excessive rain in Argentina is a renewed concern with 40% of the crop left to plant. December corn settled 12 3/4 cents higher at $7.60 1/4. March also closed 12 3/4 cents higher at $7.64.
The soybean market added onto its recent gains with a robust rally into the close on Tuesday. Bulls are feeding on worries that there are reasons to be concerned about the planting progress and early development of the South American soybean crops. Rumors of possible Chinese soybean buying also found new life on Tuesday. Strength in corn and wheat added to a bullish background environment. At the close, January had surged 24 1/2 cents at $14.49 1/4. New-crop November added 14 3/4 cents to close at $13.10 3/4. January soybean oil gained 83 points to close at 50.41 cents. January meal was up $6.50 per ton at $433.40.
The wheat markets closed sharply higher on Tuesday under growing agitation amongst traders about the status of the 2013 Plains wheat crop. On Monday afternoon, USDA reported that the national crop rating was down one point of total good plus excellent at 33%. While that was along the lines of prereport expectations, the news became well publicized on Tuesday with many vocalizing concerns about the risks for 2013 production. At the close, Chicago March wheat jumped 24 3/4 cents at $8.88 1/2. March Kansas City surged 31 1/2 cents at $9.33 1/4. The Minneapolis March contract gained 22 1/2 cents at $9.50 1/2.
Live cattle futures were mixed as futures consolidated following last week’s steep rally. No further cash trade was reported after some light trade in Texas on Monday. Cattle slaughter so far this week is estimated at 243k head, down from 259k last week and 256k a year ago. Beef prices were higher in morning trade on Tuesday. February cattle closed 7 cents lower at $132.32.
Lean hog futures settled lower on Tuesday. The losses were small with December down 10 cents to $82.38. The June contract settled at $100.20, down 65 cents. Cash prices were reported to be mixed at midday on Tuesday. The weakness in hog futures was generally due to end-of-month close-out activity and a little profit taking. Modest gains in corn and soybean prices provided some support to deferred hog futures contracts. The cash price index is still about $6 below the December futures contract price. Trading on Tuesday filled the gap left in the June contract last week.