Corn futures inched upward overnight, although the latest weather forecasts still seem very favorable for the fall harvest. Some rainfall has been added to Midwest forecasts, which could help areas of the west and do little to help crops in the eastern Corn Belt. Strength spilling over from the soybean market may be supporting corn as well. September corn futures inched up 2.0 cents to $4.0475/bushel Wednesday night, while December added 1.75 to $4.1525.
Talk of country market tightness reportedly powered modest soybean gains again overnight, with wire service sources citing rising bids at Midwest elevators and at the ports. Forecasts for increased Corn Belt rainfall might be seen as supportive of the harvest, but traders may be more concerned about excessively wet conditions in the eastern region. Talk of spot tightness likely supported meal as well, while energy market firmness seemingly boosted soyoil. August soybeans rallied 7.5 cents to $10.2825/bushel shortly after sunrise Thursday, while August soyoil gained 0.18 cents to 31.53 cents/pound and August meal moved up $2.5 to $366.0/ton.
The increased moisture forecast may be supporting wheat since it may slow the winter wheat harvest in the western Corn Belt while exaggerating the problems already being experienced with the SRW crop in eastern areas. Dryness is clearly hurting Canada’s spring wheat crop and El Nino’ is a threat to Australia’s next crop, which may be encouraging bulls as well. September CBOT wheat futures rose 4.0 cents to $5.2075/bushel early Thursday morning, while Sep KC wheat advanced 4.75 cents to $5.17/bushel, and September MWE edged 3.0 cents higher to $5.51.
Wednesday’s early hog market surge seemed to spill over into the cattle pit for a time, but bulls proved unable to sustain the advance. Bullish developments sparked a strong hog opening, which then spilled over into the cattle market. However, bears returned in force when it became rather apparent that bullish cattle news remains scarce. The cattle charts aren’t encouraging either. August cattle ended Wednesday having fallen 0.65 cents to 144.50 cents/pound, while December futures dove 0.80 to 148.97. Meanwhile, August feeder cattle futures declined 0.70 cents to 212.37 cents/pound, and November feeders dropped 1.00 to 207.27.
Early news that Iowa-Southern Minnesota hog weights fell 2.0 pounds/head last week suggested reduced pork production and tightening supplies, whereas Tuesday’s big pork gains implied resurgent demand. The fact that the nearby August future blasted through resistance associated with its pivotal 40-day moving average encouraged buying as well. August hog futures leapt 2.65 cents to 78.52 cents/pound at Wednesday’s close, while December jumped 2.62 cents to 62.37.
Wednesday’s modest cotton advance was reportedly powered by short-covering and mill buying, thereby overcoming the negative influence of U.S. dollar strength and equity market losses. However, bulls couldn’t sustain the rise last night despite a sizeable decline in the value of the greenback, but proved able to generate a bit of upward momentum early this morning. Yesterday’s bounce from support around the 64-cent level is probably attracting some follow-through bullish interest. December cotton futures had slipped 0.05 cents to 64.49 cents/pound in early Thursday trading, while March gained 0.05 cents to 64.44.