Crude oil seemed to lead commodities higher Friday morning. Ideas that the prospective settlement of EU/Greece conflict over debt and monetary union seemed to alleviate global financial fears and crush the dollar Thursday. That may also help explain the broad advance posted by the commodity markets Friday morning. Having nearby crude oil futures threatening to top their 50-day moving average is also encouraging bulls. Talk of improved demand and short-covering before the long weekend probably supported corn futures. March corn gained 4.5 cents to $3.875/bushel late Friday morning, while July rose 4.5 to $4.0275.
News of a China sale likely spurred buying in the soy complex. Soybeans and meal also appeared to rally on underlying demand strength Thursday night. The daily USDA export reporting system also indicated that Chinese buyers had contracted to buy 100,000 tonnes of beans for delivery next year. Bullish crude oil leadership and short-covering ahead of the long weekend may also have spurred buying. March soybean futures surged 10.25 cents to $9.94/bushel as the lunch hour loomed Friday, while March soyoil climbed 0.43 cents to 32.44 cents/pound, and March meal ran up $3.4 to $333.9/ton.
The wheat markets are climbing as well. Wheat bulls joined the general commodity stampede Friday morning despite generally bearish fundamentals. Ideas that Russian export tariffs are keeping that country’s product from undercutting the global market may be encouraging buyers, as is the generally optimistic demand environment. In addition, nearby futures seem to be breaking out above the confluence of their short-term moving averages, thereby encouraging technical buying. March CBOT wheat advanced 9.0 cents to $5.3025/bushel around midsession Friday, while March KC wheat added 6.25 cents to $5.6025/bushel, and March MWE wheat lifted 9.25 to $5.835.
Cattle futures surged in early Friday trading. CME cattle traders essentially ignored overnight news that a Canadian cow had been found infected with ‘mad cow’ disease, since it’s rather obvious that there’s very little threat to the American beef supply. Instead, traders seemed to react to the idea that country cattle will once again trade well above the discounted levels built into CME futures. April live cattle futures leapt 2.72 cents to 153.85 cents/pound in late Friday morning action, while August cattle jumped 2.22 cents to 144.30 cents/pound. Meanwhile, March feeder cattle futures spiked 3.32 cents to 203.62 cents/pound and May feeders soared 2.52 to 202.87.
Bullish expectations again seemed to boost CME hogs. The short-term hog/pork outlook still seems less than promising, especially with a four-day work stoppage reportedly looming at West Coast ports. Nevertheless, deferred hog futures streaked upward, which probably reflects anticipation of resurgent pork demand once the port situation ends. April hog futures bounded 1.82 cents higher to 66.32 cents/pound just before lunchtime Friday, while June hogs zoomed up 2.42 to 80.97.
Cotton traders joined the general advance. The cotton market has performed well lately, so the idea that recent deflationary talk has been overdone, as exemplified by the crude oil market’s challenge of its 50-day moving average, probably encouraged cotton bulls as well. Conversely, position-squaring before the three-day weekend may take the form of long-liquidation, thereby limiting today’s upside potential. March cotton futures moved up 0.11 cents to 62.59 cents/pound shortly after noon (EST) Friday, while the July contract ascended 0.25 to 63.46.