USDA data is weighing on the grain markets. Tuesday’s belated release of the weekly USDA Crop Progress report likely spurred overnight selling; that apparently continued this morning. Not only did the report indicate corn plantings still ahead of normal, the initial corn condition rating at 74% good-to-excellent was better than normal. The market may also be suffering from follow-through selling in the wake of yesterday’s dollar-driven drop. Traders cited dollar strength for midday losses. July corn futures dipped 3.5 cents to $3.515/bushel late Wednesday morning, while December lost 4.0 to $3.6925
Argentina’s labor situation still seems to be supporting the soy complex. Overnight palm oil slippage and a morning downturn in energy prices apparently depressed soyoil as well. Meanwhile, the Crop Progress data indicated good bean planting progress. Nevertheless, bean and meal futures are working higher, which probably reflects growing concern about the Argentine labor situation and that country’s ability to ship product in the near future. July soybean futures rallied 3.0 cents to $9.255/bushel around midsession Wednesday, while July soyoil fell 0.33 cents to 31.81 cents/pound, and July meal climbed $4.8 to $306.7/ton.
Wheat markets have also followed through to the downside. The Crop Progress report looked negative for the Minneapolis market, since spring wheat condition ratings jumped from 65% to 69% good to excellent. Similar winter wheat ratings were unchanged. Forecasts for early-June dryness in the southern Plains may also be weighing on KC prices. Bearish momentum spilling over from Tuesday’s breakdown is likely playing a role in the drop, as is talk of increasing Russian production. July CBOT wheat futures fell 3.5 cents to $4.90/bushel just before lunchtime Wednesday, while July KC wheat dropped 10.0 cents to $5.145/bushel, and July MWE wheat stumbled 6.0 to $5.4725.
Firming beef prices are apparently supporting cattle futures. Tuesday’s mixed cattle action seemed in keeping with generally seasonal pessimism. However, the wholesale market proved surprisingly strong yesterday, thereby giving rise to ideas that discounts already built into summer futures are too large. June live cattle futures advanced 0.40 to 152.20 cents/pound in late Wednesday morning trading, while August cattle lifted 0.60 to 151.22. Meanwhile, August feeder cattle futures surged 0.97 cents to 220.57 cents/pound, and November feeders moved up 0.57 to 217.30.
Spot market firmness is also boosting CME hogs. Hog and pork traders are apparently anticipating seasonal price weakness through early June, but Tuesday’s late reports indicated considerable strength at both the cash and wholesale levels. Suspicions that the bounce might persist apparently powered today’s early Chicago gains. June hog futures vaulted 0.52 cents to 83.70 cents/pound as the lunch hour loomed Wednesday, while December slid 0.22 to 69.85.