Traders are selling ahead of today’s WASDE report. The USDA will release its monthly WASDE (World Supply/Demand) report at 11:00 CDT this morning, which clearly has the potential to move markets. Corn futures declined in concert with the other crop markets overnight, with likely long liquidation and U.S. dollar strength weighing on prices. A report that Chinese Government stocks will soon reach 80 million tonnes may also be depressing the yellow grain. May corn futures slipped 0.25 cent to $3.79/bushel Wednesday night, while December lost 0.25 to $4.045.  

Talk of growing South American supplies undercut the soy complex. The ongoing U.S. dollar rebound seemingly played a role in overnight soy losses, especially with industry sources also citing record South American production for selling beans and products last night. Continued palm oil slippage apparently outweighed the crude market’s positive influence over soyoil direction. May soybean futures dipped 4.25 cents to $9.6725/bushel in early Thursday trading, while May soyoil fell 0.26 cents to 30.69 cents/pound, and May meal skidded $0.7 to $319.2/ton.

Weather news probably spurred selling in the wheat markets. We suspect position squaring also played a role in the overnight wheat decline, but wire service reports cited improved weather conditions and improved production prospects in the southern Plains, as well as in other major wheat growing regions. May CBOT wheat slumped 4.75 cents to $5.215/bushel early Thursday morning, while May KC wheat slid 4.5 cents to $5.5675/bushel, and May MWE wheat sagged 2.25 to $5.7825.  

Cattle futures turned decidedly lower Wednesday. CME cattle traders seemed caught between current spot market strength and bearish seasonal expectations in early Wednesday trading. Futures later turned downward despite a midday report of sizeable wholesale gains. The industry clearly remains skeptical of recent cash strength. Still, late beef strength seems likely to lead to a firm opening this morning. June cattle futures fell 0.87 cents to 151.45 cents/pound as the CME pit session ended Wednesday, while August cattle drooped 0.35 to 148.55 cents/pound. Meanwhile, May feeder cattle futures dove 1.47 cents to 213.47 cents/pound, and August feeders tumbled 1.37 to 214.92.   

Nearby April diverged from gains in deferred hog futures. Country hog quotes firmed Wednesday morning, but the pork markets were mixed. That likely explains the lack of strength exhibited by the nearby April contract yesterday. Conversely, talk of seasonal strength, particularly the potential for improved pork demand, apparently boosted the deferred contracts. Afternoon GLOBEX gains suggest early strength today as well. June hog futures climbed 0.75 cents to 77.10 cents/pound at Wednesday’s settlement, while December advanced 0.70 to 70.97.   

Cotton traders may be taking profits ahead of today’s reports. Recent news supported cotton futures, with a technical breakout likely exaggerating this week’s gains. However, with both the weekly Export Sales and monthly WASDE reports due for release this morning, numerous bullish traders very likely took profits last night. Having the U.S. dollar continue its late advance probably encouraged them to do so. May cotton sank 0.39 cents to 66.34 cents/pound shortly after sunrise Thursday, while December futures dropped 0.85 to 65.12.