Ag markets moved mostly lower Wednesday night

Concern about corn exports to China reemerged Wednesday night. Corn rallied yesterday in response to a sizeable export sale and talk of surging ethanol production. However, traders worry that recent rejections of U.S. shipments to China (due to an unapproved GMO strain) are harbingers of a wider ban by Chinese officials. March corn futures dipped 2.25 cents to $4.37/bushel early Thursday morning, while May lost added 2.75 cents to $4.45.

The soy complex set back from Wednesday's highs. A big South Korean meal purchase and an official reduction in China's latest production estimates seemingly boosted the soy complex yesterday. Otherwise, little fresh soybean news emerged overnight, thereby seeming to again open the market to the malign influence of bumper production forecasts for South America's forthcoming crops. Sliding palm oil prices probably weighed upon the soyoil market as well. January soybeans fell 8.5 cents to $13.3525/bushel Wednesday night, while January soyoil slid 0.14 cents to 40.26 cents/pound, and January soymeal sank $3.2 to $435.7/ton.

The wheat markets diverged modestly in early Thursday trading. Massive 2013 crops are weighing rather heavily upon wheat prices at this point. The impression that the U.S. market was relatively high also seemed to be weighing upon domestic values lately. However, Japan announced that it had bought mostly U.S. wheat in a recent tender; the fact that much of the U.S. grain was spring wheat probably explains the comparative strength of the Minneapolis market last night. March CBOT wheat futures sagged 1.25 cents to $6.395/bushel around dawn Thursday, while March KCBT wheat futures were steady at $6.8475, and March MWE futures rallied 2.25 cents to $6.7075.

Cattle futures were mostly lower last night. Short-term cash market expectations seemingly turned somewhat more positive Wednesday, which probably explains modest gains in expiring December futures yesterday and again overnight. However, concerns about increased feedyard supplies and flat demand continue weighing upon deferred futures. February cattle futures slipped 0.07 cents to 132.72 cents/pound in early Thursday trading, while with April futures gained 0.02 to 133.85. Meanwhile, January feeder cattle edged 0.12 cents lower to 165.55 cents/pound, and March feeders skidded 0.15 to 165.35.

Wednesday's late cash gains boosted hog futures this morning. Cash market losses late last week and earlier this week apparently weighed heavily upon CME futures, particularly with pork prices also under pressure. However, cash quotes west of the Mississippi River posted surprising gains yesterday afternoon, which probably powered modest overnight gains. February hog futures bounced 0.25 cents to 88.02 cents/pound in pre-dawn Thursday action, while June rose 0.25 to 99.85.

Cotton futures set back from technical resistance in early trading. Supportive news pushed cotton futures modestly higher early this week, which then triggered a cascade of buying yesterday. The latter was probably technical in nature, so it wasn't terribly surprising to see the surge fail and reverse from its 100-day moving average overnight. March cotton futures tumbled 0.47 cents to 82.02 cents/pound just after sunrise Thursday, and July cotton dropped 0.46 cents to 81.20.