Agricultural markets were mixed Monday morning

After beginning the week slightly lower, corn futures bounced modestly in response to the weekly Export Inspections report issued around midmorning Monday. Wire service sources also cited light short-covering for a portion of the rebound, especially after the nearby March contract had closed lower for six consecutive CBOT sessions. March corn was trading 0.75 cents higher, at $7.0975/bushel in late-morning trading, whereas December had slipped 1.0 cent to $5.6225.

Soybean futures continued their recent breakdown Monday, with market observers citing persistent weakness stemming from the February 8 WASDE report. The USDA boosted its forecast of global soybean carryout for 2012-13 over 1% on that release, which substantially exceeded expectations. The industry may also be reacting to moderate improvements in short-term weather forecasts for dry Argentine soybean fields. March soybeans had fallen 18.0 cents to 14.345 late Monday morning, while March soyoil dropped 0.27 cents to 51.16 cents/pound, while March meal sank $8.16 to 414.3/ton.

The Monday morning export inspections report apparently did little to excite wheat traders, since they quickly reversed their initial bullish reaction. Bulls are probably disappointed with early-week activity, especially after Russia announced it would suspect a 5% import tariff on wheat imports in order to alleviate its domestic supply shortage. Large soybean losses may be dragging wheat lower as well. March CBOT wheat futures were trading 7.0 cents lower, at $7.4925/bushel around noon, while March KCBT wheat had slipped just 2.5 cents to $7.9725, and March MGE futures slid 4.25 cents to $8.32.

After opening weakly, CME live cattle futures posted a moderate bounce late on Monday morning. We suspect talk of a lengthy Russian ban on U.S. product weighed rather heavily upon prices late last week and again this morning, particularly when those were viewed in light of relatively strong Russian buying over the past two years. However, the decline seemingly lost its downward momentum, which may have prompted the subsequent rebound. April cattle rose 0.22 cents lower to 130.35 in late-morning trading, while August bounced 0.30 cents to 126.77. Meanwhile, March feeder cattle were 0.32 cents lower, at 144.67 cents/pound at that point, and August had rebounded 0.60 cents to 157.30.

Hog futures were generally mixed to slightly higher around mid-session Monday. News of the Russian embargo on American meat probably weighed upon prices somewhat, but the realization that Russia is a much smaller player on the pork side may have prompted the subsequent bounce. We wonder if anticipation of a last-gasp mid-winter bounce boosted Chicago prices. April hogs had risen 0.32 cents to 86.45 cents/pound by mid-session, while June gained 0.02 cents to 94.52.

After traded in mixed fashion in early morning action, cotton futures rallied late Monday morning. We suspect two tentative U.S. acreage forecasts reports, one from the National Cotton Council and another from the long-term outlook published by the USDA this morning, sparked the late advance, because both implied substantial reductions in domestic cotton plantings this spring. March cotton had risen 0.20 cents to 82.87 cents/pound in late-morning activity, while its December counterpart had climbed 0.31 cents to 83.23.