Dollar weakness boosted most crop markets Tuesday. The grain and soy markets moved almost unanimously higher overnight, due largely to surprisingly weak condition ratings and slow soy planting progress. Those moves were amplified this morning, when fresh optimism about an E.U.-Greece debt/banking deal sent the U.S. dollar tumbling. July corn closed up 6.75 cents to $3.59/bushel Tuesday, and December added 7.0 to $3.76.
Dollar weakness sent beans and meal sharply higher. The weekly USDA Crop Progress report stated U.S. soybean plantings well below expectations Monday, which sparked the overnight rally in beans and meal. That move was apparently exaggerated by today’s big U.S. dollar drop as those two markets rallied. The meal surge clearly favored that market over oil, which might explain the surprising oil weakness. July soybean futures leapt 14.75 cents to $9.4075/bushel at the closing session Tuesday, while July soyoil skidded 0.34 cents/pound to 34.17, and July meal ran up $5.2 to $301.80/ton.
The wheat markets proved very strong Tuesday. Good export news, weak winter wheat condition ratings and dollar weakness appeared to spur fresh wheat buying this morning. The move was probably exaggerated by active short-covering by funds holding huge bearish positions, especially after the July Chicago contract topped its 40 and 50-day moving averages. July CBOT wheat futures jumped 18.75 cents to $5.125/bushel at the end of day Tuesday, and July KC wheat surged 22 cents to $5.3625/bushel, and July MWE wheat vaulted 23.25 cents to $5.695.
Bears are struggling to force discounted cattle futures lower. Underlying beef demand seems firm despite greatly elevated wholesale prices, with last week’s stable cash trading sparking Monday’s gains. Mixed afternoon beef quotes apparently caused today’s early decline, but the fact that the various contracts continue trading at significant discounts to cash seemingly limited those losses. August live cattle futures closed even at 152.00 cents/pound on Tuesday, as did December cattle at 154.90. Meanwhile, August feeder cattle futures fell 0.375 cents to 223.32 cents/pound, and November feeders slumped 0.475 to 219.30.
Profit-taking reportedly hit hog futures during trading Tuesday. While CME hogs performed well Monday, they proved unable to break out above major chart resistance at modestly higher levels. That technical failure, as well as persistent ideas about short-term seasonal weakness seemed to spark long liquidation and short selling this morning. August hog futures declined 0.70 cents to 82.725 cents/pound at the close Tuesday, while December sank 0.575 to 69.25.
Cotton tested underlying support Tuesday. The cotton market seemingly has numerous reasons to rally, with last Friday’s strong export data, Monday’s news of slow plantings and today’s big U.S. dollar dive all making the bullish case. While cotton futures turned downward this morning, with midsession quotes testing underlying support, cotton prices saw boost in late day trading and eventually closed higher. July cotton edged 0.01 cents higher to 63.76 cents/pound at end of trading Tuesday, and December futures boosted 0.03 cents higher to 64.06.