The grain markets lowered in the overnight session, winding down what has been bumpy ride this week. Variances in trade beliefs about yields will surely be a discussion piece for days, but in the meantime, markets will seek direction from weather and other data moving toward September in order to better refine production and yield estimates. Old-crop corn export sales were 29,239 tonnes, compared to the 50,000-250-000 trade expectation. New-crop sales were 501,856 tonnes, topping the 450,000-750,000 estimate. September corn futures dropped 2 cents to $3.6175/bushel early Friday morning, while December fell 2.25 cents to $3.73.
The oilseed markets weakened early Friday morning negating gains from yesterday’s post-WASDE bounce. Old-crop soybean export sales were 96,322 tonnes, compared to the -150,000 to 250,000 estimate while new crop sales were 660,495 tonnes versus the 450,000-750,000 trade expectation. Today marks the last day for August soybean futures contract which will go off the board at 12:000 CDT today. Monday, the NOPA crush and USDA crop progress reports will be released. September soybeans lost 7.5 cents to $9.2875/bushel early Friday, while September soyoil slipped 0.10 cents to 28.89 cents/pound and September meal dropped $2.3 to $328.6/ton.
The wheat market followed corn and beans lower overnight on end-of-week consolidation and reiterating the bearish responses to Wednesday’s Supply/Demand data. Export sales for 2015/2016 wheat were reported to be 421,558 tonnes, compared to the 400,000-600,000 estimate. The 6 to 10 day weather outlook is above normal temps for southern and eastern parts of the Corn Belt and above normal rains for the Corn Belt and much of the Midwest. September CBOT wheat futures dropped 4 cents to $4.9925/bushel early Friday, while Sep KC wheat lost 2.75 cents to $4.825/bushel, and September MWE weakened 3.75 cents $5.145.
Live cattle futures also rebounded in concert with the grain and soy markets. The implied increase in prospective feed costs probably played a role in the rise, but fresh strength in choice beef cutout probably encouraged buying as well. One also has to suspect ideas about firm to higher cash prices played a role in the late advance. October cattle vaulted 1.25 cents to 147.85 cents/pound as Thursday’s CME session wound down, February futures rose 0.15 cents to 148.65. Meanwhile, October feeder cattle futures edged up 0.30 cents to 208.32 cents/pound, while January feeders lost 0.20 cents to 199.85.
Persistent spot market firmness apparently spurred hog gains. Hog and pork traders have clearly been expecting surging hog supplies to depress the complex at this time, but prices have refused to drop. That is, the CME lean hog index has stayed surprisingly firm, thereby pulling the expiring August contract upward. One also has to suspect the industry is starting to see hog supplies more in line with the 7%-9% increases implied by the June USDA Hogs & Pigs report, rather than the massive 12%-14% gains routinely seen during early summer. October hog futures ended Thursday having leapt 1.67 cents to 65.05 cents/pound, while February moved up 0.25 cents to 65.60.
The cotton market traded higher again overnight after being one of the few commodities that emerged a winner from the recent report. Wednesday’s USDA data looked very bullish for the fiber outlook, since projections for domestic acreage and production fell far short of industry expectations. Today’s weekly USDA Export Sales report, which indicated the latest total at 536,200 bales, also seemed to encourage bulls. The global situation still seems decidedly unhelpful to the bullish cause, which may have limited gains and played a role in the late-session drop Thursday. December cotton futures lifted 0.05 cents to 65.84 cents/pound early Friday morning, while May rallied 0.50cents to 65.47.