Corn set back from Thursday’s highs. Although the USDA published its planted acreage estimates yesterday morning and followed with supply/demand projections for 2015/16 early today, those data have not seemed to move the crop markets substantially. Instead, news of strong ethanol usage powered Thursday’s corn rally. Conversely, priced dipped overnight, which may have simply represented an inability to crack overhead resistance around $4.00. March corn slid 1.75 cents to $3.88/bushel Thursday night, while July lost 1.75 to $4.035.
The soy complex also dipped. Strong demand for beans and meal remain very price supportive. When combined with a surprisingly low soy planting figure from the Outlook Forum, those powered significant CBOT gains. However, as with corn, the nearby contracts are bumping up against major technical resistance. That may explain the Thursday night setback and lack of reaction to this morning’s USDA news. March soybean futures sank 3.75 cents to $10.035/bushel early Friday morning, while March soyoil skidded 0.02 cents to 31.81 cents/pound, and March meal dipped $1.3 to $346.2/ton.
The wheat markets edged upward overnight. Although wheat bulls tried to push prices higher in concert with corn and beans yesterday, they ultimately failed to counter the bearish gloom. Prices moved modestly lower at the futures’ close. The simple facts that world wheat supplies are huge and U.S. grain is seen as overpriced remain major obstacles to bullish interests. Nevertheless, prices did move slightly higher overnight. March CBOT wheat rose 0.75 cent to $5.285/bushel in predawn Friday action, while March KC wheat inched up 1.0 to $5.455/bushel, and March MWE wheat stalled at $5.74.
Cattle traders may have expected cash weakness Thursday. Recent spot market developments have seemed very supportive of live cattle futures, especially with the nearby contracts trading at sizeable discounts to last week’s cash levels. And yet, futures proved surprisingly weak yesterday, which seemingly reflected fresh pessimism about the likely result of this week’s cash trading. Prices rose in GLOBEX trading, but cash expectations could drive today’s CME opening. April cattle futures fell 1.12 cents to 151.50 cents/pound at their Thursday CME settlement, while August cattle sank 0.17 cents to 142.67 cents/pound. Meanwhile, March feeder cattle futures slumped 0.55 cents to 202.55 cents/pound and May feeders tumbled 0.45 to 200.90.
Spot firmness spurred strong CME hog gains. After falling consistently for weeks, the cash hog and wholesale pork markets showed clear signs of firming earlier this week. The fact that they seem to be bottoming in the absence of a resolution to the export situation is probably encouraging traders as well. Pork quotes dipped Thursday afternoon, but cash hog prices rose significantly; that seemingly presages another strong opening. April hog futures soared 2.82 cents to 67.05 cents/pound at Thursday’s settlement, while June hogs leapt 2.20 to 81.45.
Cotton also proved rather weak Thursday night. Cotton traders apparently dismissed the comparatively high USDA cotton plantings figure rather quickly yesterday, with futures pushing higher through midsession. However, the ICE market gave back those gains and then some later in the day. They extended the losses overnight despite a shortage of certificated stocks deliverable against the expiring March contract. We still suspect bulls were taking profits ahead of this morning’s export sales data. March cotton futures sagged 0.15 cents to 64.29 cents/pound shortly after Friday’s sunrise, while the July contract drooped 0.17 to 65.02.