Ag markets look set to end the week in mixed fashion

Spillover strength seemed to boost corn futures Thursday night. An upward revision to estimates of Chinese soybean imports and weather concerns about the Australian wheat crop boosted those markets overnight. There was little fresh corn news, so it wasn't terribly surprising to see it following the soy and wheat complexes higher. December corn futures rose 1.5 cents to $4.245/bushel early Friday morning, while May added 1.25 to $4.3875.

Soybeans and meal proved quite strong overnight. Chinese officials revised their estimates of November soybean imports upward by about 200,000 tonnes early this morning, which seemingly sparked CBOT soybean and meal gains. In contrast, slumping palm prices dragged soyoil futures lower. January soybean futures jumped 12.75 cents to $13.0425/bushel in pre-dawn Friday trading, while December soyoil dipped 0.14 cents to 41.40 cents/pound, and December soymeal ran up $7.1 to $418.1/ton.

Talk of Australian problems boosted the wheat markets. Western Australian wheat fields are being blessed with excessive rainfall, whereas fields on the east coast have reportedly suffered significant frost damage lately. The U.S. winter wheat markets responded well to that news, while Minneapolis futures were less affected. December CBOT wheat futures gained 3.0 cents to $6.5175/bushel in early Friday trading, while December KCBT wheat futures climbed 3.25 cents to $6.98, and December MWE futures edged up 1.75 to $6.98.

Wholesale weakness seemingly offset stable cash cattle quotes last night. Country cattle prices dipped Thursday, but the size of the decline was smaller than many anticipated. However, beef cutout values fell rather substantially in late-afternoon action. That development apparently weighed upon CME futures overnight. December cattle futures were flat at 131.45 early Friday morning, while April futures sagged 0.12 cents to 132.95. Meanwhile, January feeder cattle advanced 0.07 cents to 163.45 cents/pound, and March feeders rallied 0.27 cents to 163.55.

Diving cash prices are undercutting hog futures. Although wholesale quotes proved surprisingly firm Thursday afternoon, that good news was apparently more than offset by sizeable losses in the country cash markets. CME futures declined as a consequence. December hog futures sank 0.32 cents to 85.92 cents/pound as Friday dawned in Chicago, while April fell 0.20 cents to 93.05.

Position squaring may be weighing upon cotton futures. Although the expiring December contract declined, deferred ICE cotton futures held up well in the face of bearish export news Thursday. However, technical factors seemed to spark broad position-squaring before the weekend in Thursday night trading. December cotton slid 0.32 cents to 74.47 cents/pound just after sunrise (EST) Friday, while March cotton tumbled 0.72 to 77.63.


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