The crop markets rose Wednesday night. Little grain or soy news emerged last night, which made the concerted advance posted by the crop markets rather remarkable. Traders may have been reacting to recent equity strength and to a second consecutive decline in the value of the U.S. dollar, since both moves are conducive to demand. The corn market may struggle to follow-through, since it’s bumping up against moving average resistance. March corn futures gained 2.5 cents to $3.905/bushel early Thursday morning, while July moved up 2.5 to $4.05.
Optimism about the demand outlook seems to be supporting beans and meal. The fact that Chinese buyers came back to the U.S. soybean market soon after cancelling two other U.S. shipments suggested underlying demand for American products remains robust. Persistent soymeal firmness also implies active offtake. Such factors are apparently offsetting the bearish influence of the looming harvest of huge South American crops. March soybean futures advanced 7.5 cents to $9.91/bushel Wednesday night, while March soyoil inched up 0.01 to 32.42 cents/pound, and March meal rallied $4.1 to $334.6/ton.
Wheat futures posted modest gains as well. The Russia-Ukraine conflict seemed to escalate somewhat overnight, which may explain the moderate rebound in wheat futures. Last year’s fighting didn’t seem to substantially affect exports from the Black Sea region, but that might not be the case in the coming weeks and months. March CBOT wheat climbed 5.0 cents to $5.4175/bushel as Thursday dawned over Chicago, while March KC wheat rose 4.5 cents to $5.7675/bushel, and March MWE wheat added 3.0 to $5.84.
Cattle futures firmed as Wednesday passed. Chicago cattle reacted rather poorly to late Tuesday reports indicating fresh wholesale beef weakness. However, yesterday’s midsession quotes rose modestly, which seemingly spurred buying at the CME. Technicians may also have been buying after the April future seemed to complete a major follow-through drop yesterday. Conversely, late beef weakness and GLOBEX slippage suggest a poor opening this morning. February live cattle futures climbed 0.65 cents to 153.70 cents/pound at Wednesday’s close, while the April contract ran up 0.80 cents to 151.87. January feeder cattle futures jumped 1.22 cents to 215.70, and March feeders soared 2.82 to 205.30.
CME hogs posted a decidedly mixed close. The cash hog markets were called weak to lower again Wednesday morning, with industry sources citing a line-up of animals at packing plant gates. Still, Chicago futures bounced from early lows, thereby seeming to reflect Tuesday’s late pork gains. Ultimately, divergent cash and wholesale quotes seemed to have a similar impact upon swine futures. Late news of an Iowa price surge spurred afternoon buying, which bodes well for today’s early action. February hog futures ended Wednesday having advanced 0.57 cents to 72.35 cents/pound, while June hogs bounced 0.47 cents to 84.15.
Nearby cotton futures also moved higher last night. The fiber market also suffered a dearth of news Wednesday night, but that didn’t keep ICE traders from pushing prices modestly higher. The technical situation seems less than promising at this juncture, but the prospect of a huge U.S. production cut in 2015 may be offering background support. This week’s equity firmness and U.S. dollar slippage may be encouraging bulls somewhat. March cotton futures lifted 0.22 cents at 58.23 cents/pound just after sunrise Thursday, while the July contract edged 0.07 higher to 59.89.