Crop markets strongly higher at midsession

Corn futures are sharply higher at midday. The USDA reports showed corn stocks at 6.01 billion bushels, down from the trade estimate of 6.15 billion and more than 500 million bushels lower than a year ago. Acreage is pegged at 95.9 million acres, above the high end of trade estimates and well above the average estimate of 94.7 million. This compares to 91.9 million in 2011. Planting intentions are higher than expected, but sharply higher old-crop prices are pulling new-crop prices higher too. May is 35 1/2 cents higher at $6.39 1/2 and December is 16 cents higher at $5.40 1/4.

Soybean futures are trading strongly higher at midsession. The USDA reports were bullish for soybeans with plantings pegged at 73.90 million acres, below the low end of trade estimates and well off the average estimate of 75.39 million acres and last year’s 74.98 million. This will be especially bullish given the struggling South American crop. Stocks were a little below trade estimates at 1.372 billion bushels compared to 1.387 billion. The May contract is 58 cents higher at $14.13 1/2 and November is 62 cents higher at $13.66 3/4.

Wheat futures are trading strongly higher at midday. The USDA reports were bullish for wheat as acreage was forecast at 55.9 million acres, the low end of trade expectations. The average trade estimate was looking for 57.42 million. Spring wheat has the biggest impact at 12.0 million acres versus the trade estimate of 13.3 million and below year-ago’s 12.39 million. Stocks were pegged at 1.201 billion bushels compared to trade estimate of 1.223 billion. CBOT May is 33 3/4 cents higher at $6.46 1/4; KCBT May is 26 1/2 cents higher at $6.80 1/2; MGE May is 35 3/4 cents higher at $8.24 1/2.

Cattle futures are trading mixed at midday. Futures are firming mainly on short covering driven by sharply higher grain prices. Bullish USDA reports sparked steep gains in the grain markets and after the plunge in cattle future over the past several sessions, the futures are due for a correction higher. However, continued weakness in the beef market is seen as a limiting factor. April cattle futures are 65 cents lower at $121.85 and June is 15 cents lower at $118.33.

Lean hog futures are trading higher at midday. Buying interest has improved on Friday following two days of sharply lower prices. There has been no real change in market fundamentals and cash hog prices and cutout values were both down again on Thursday. But with prices down $3 per cwt since Tuesday there is a sense that the market has over-reacted. The big decline in prices makes a bearish surprise in the Hogs and Pigs report less likely. April is 48 cents higher at $83.50 and June is 78 cents higher at $90.85. 

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