After being swept lower in the general financial market sell-off Monday, corn futures were narrowly mixed in early Tuesday morning trading. There seemed to be little news pertinent to the yellow grain market, so traders are apparently awaiting events. May corn had slipped 0.25 cent to $6.465/bushel in early Tuesday action, while December rose 0.75 cent to $5.33.
Despite talk that slowing economic growth and its avian flu problem will reduce Chinese soy demand, soybean futures led that complex higher Monday night. There seemed to be little supportive news, so the rise seemingly represented a pragmatically driven response to the big Monday across-the-board breakdown. May soybeans rebounded 13.0 cents to $14.08/bushel in overnight trading, while May soyoil jumped 0.38 cents to 48.56 cents/pound, and May meal surged $4.6 to $397.5/ton.
Wheat futures were mixed to higher in early Tuesday electronic action. The Monday afternoon crop progress/condition reports seemed supportive of a rebound. For example, winter wheat conditions had not improved over the past week, whereas spring wheat plantings are well behind normal. Deferred futures in Minneapolis apparently rose in response to the latter news. May CBOT wheat futures were unchanged at $6.9375/bushel in predawn Tuesday trading, while May KCBT wheat gained 1.0 cent to $7.335, and May MGE futures climbed 1.0 cent to $7.99.
Cattle futures proved equally vulnerable to selling during the Monday financial and commodity market breakdown. In fact, prices remained under pressure early Tuesday morning, possibly due to ideas that cheaper feed costs will spur production of livestock and meat during the weeks and months ahead. The fact that wholesale values were decidedly mixed Monday may also have discouraged traders looking for short-term strength. June cattle rose 0.07 cents to 119.90 cents/pound in early Tuesday morning action, while December lost 0.17 cents to 125.27. May feeder cattle futures slid 0.30 cents to 139.50 cents/pound, and August skidded 0.35 cents to 146.02.
The Monday market decline carried hog futures lower as well. The swine situation was not helped by mixed to lower cash prices, but wholesale pork values actually rose significantly. The latter development probably explains the modest rebound posted by CME futures overnight. The main question facing the swine industry is whether the cash and wholesale markets can post a spring advance strong enough to justify the premiums built into the spring and summer contracts. Nearby May futures lost 0.35 cents to 85.92 cents/pound in overnight trading, while the June contract bounced 0.20 cents to 88.80.
Cotton futures were no more immune to the big Monday breakdown than the other commodity markets, due in part to the fact that apparel demand typically fluctuates in concert with global economic activity. Conversely, it rebounded in keeping with the general upward push experienced overnight. Sizeable soybean gains may also have supported the white fiber values, since high soybean prices may cause U.S. acreage to shift to legume production. May cotton advanced 0.22 cents to 84.55 cents/pound early Tuesday morning, while December added 0.20 cents to 85.38.