Corn futures reversed despite supportive Tuesday morning news. Corn futures sustained their recent advance Monday night and initially reacted well to USDA news of a sizeable sale. However, prices turned decidedly lower soon thereafter. No obvious news was undercutting the market, thereby suggesting technical factors has sparked the selling. The fact that the U.S. dollar is retesting last week’s highs may also be weighing on the crop markets. March corn futures fell 7.5 cents to $3.945/bushel around midsession Tuesday, while July lost 7.25 to $4.1095.
The soy complex turned mixed. Talk of persistently strong demand seemingly boosted the soy complex Monday night, but beans and meal turned lower in concert with the grain markets. The reason for the reversal wasn’t readily apparent, particularly with the equity markets surging once again. One has to wonder if the ag markets are finally recognizing the size of the recent dollar advance and its potential to reduce exports. March soybean futures sank 2.75 cents to $10.1075/bushel as the lunch hour loomed Tuesday, while March soyoil rose 0.13 cents to 32.73 cents/pound, and March meal edged $1.7 lower to $339.5/ton.
The wheat markets sagged despite supportive Russian news. Yesterday’s reports were net bearish for the wheat outlook, but futures rebounded strongly last night in reaction to news that Russian officials are tightening their curbs on that country’s exports. However, as with corn and soybeans, the golden grain couldn’t sustain the move, possibly due to diminishing U.S. export prospects as the dollar rises. March CBOT wheat inched up 1.5 cents to $5.57/bushel late Tuesday morning, while March KC wheat slid 0.5 cent to $5.90/bushel, and March MWE wheat rose 0.25 to $5.955.
Cattle futures are struggling once again. As expected, the persistent beef gains exemplified by late Monday reports sparked a firm opening in CME cattle this morning. However, as has become rather routine lately, bulls couldn’t sustain the move in nearby futures. One has to suspect traders believe the livestock markets will suffer in an energy-driven deflationary environment. February live cattle futures dove 0.97 cents to 159.47 cents/pound in late Tuesday morning trading, while the April contract dropped 0.77 cents to 158.57. January feeder cattle futures tumbled 1.15 cents to 222.25 cents/pound, and March feeders plunged 1.60 cents to 211.70.
Hog futures remained generally weak as well. CME hog prices resumed their recent decline soon after Tuesday’s opening, with traders apparently looking for persistent losses at the cash level. Mixed pork quotes did little to discourage bears despite the swine complex’s history of seasonal strength in January and early February. February hog futures slumped 0.85 cents to 75.80 cents/pound, while June hogs declined 0.47 cents to 87.02.