Ag markets seem set to begin this week on a downward note

Corn and soybean futures resumed their recent decline over the weekend. As was seen late last week, grain and soy buyers now believe they can avoid paying up for old crop product from this point, whereas glorious summer weather over the Corn Belt seems set to produce a record crop. The modest September gain suggests the broader market is not convinced. September corn futures edged up 0.5 cent to $4.925/bushel in early Monday trading, while December dipped 0.75 cents to $4.7525.

The soy complex also lost ground Sunday night. As in the corn pit, the prospect of a huge fall soybean crop almost surely caused new crop futures to continue sliding. The growing industry belief that it can bridge the time frame until freshly harvested beans are available is also undercutting old crop prices. August soybean futures fell 6.0 cents to $13.4375/bushel early Monday morning, while August soyoil sagged 0.18 cents to 43.40 cents/pound, and August soymeal slid $3.3 to $427.0/ton. November beans lost 10.5 cent to $12.6475.

Wheat futures again held up remarkably well in early Monday trading. Sliding corn and soybean markets were still working against potential wheat strength, but the prospect of huge Chinese buying apparently more than offset those bearish influences once again. Lost acreage in North Dakota may also be supporting wheat prices. September CBOT wheat gained 1.25 cents to $6.515/bushel as trading resumed this week, while September KCBT wheat added 1.75 cents to $6.9325 and September MGE futures rose 1.0 cent to $7.375.

Cash market strength boosted cattle futures last Friday. CME cattle traders had been persistently disappointed while anticipating a seasonal cash market advance, but packers finally boosted their bids in early-Friday trading. That news quickly translated into Chicago gains. August cattle advanced 0.15 cents to 121.80 cents/pound as trading wound down Friday, while December climbed 0.33 cents to 128.65. August feeder futures surged 0.25 cents to 152.60 cents/pound, while November lifted 0.52 cents to 158.92.

Hog futures posted surprising losses to end last week. Despite late-Thursday reports of considerable cash hog and wholesale pork strength, as well as the gains being posted in the cattle pit next door, hog futures turned decidedly lower Friday morning. The dwindling difference between the nearby August futures price and the CME index may have rendered the nearby future vulnerable to selling. Mixed afternoon cash and wholesale quotes probably presaged similar CME trading later this morning. August hog futures settled down 0.80 cents at 97.77 cents/pound Friday afternoon, while December dove 0.75 cents to 81.85.

The latest weather news seemingly supported ICE cotton futures Sunday night. Conditions in the important growing areas of Texas are dry relative to many areas of the country and seem likely to worsen due to a general lack of rainfall during early August. Actually, nearby futures are stuck within trading ranges, with a breakout in either direction seeming likely to spark a larger move. October cotton inched up 0.19 cents to 85.56 cents/pound early Monday morning, while December ground out a 0.29 cent gain to 85.41.


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