Corn futures are 2-5 cents higher at midday. Corn was mixed in the overnight trade, but has turned higher this morning along with gains in wheat on news that Ukraine is about to halt wheat exports. Ukraine exports some feed wheat as well as corn so the ban could have implications for corn trade. Even though corn exports so far have been very poor, expectations are improving for late this year and early 2013. December corn is 4 ¾ cents higher at $7.65 ½. The March contract is 3 ½ cents higher at $7.62 ¾.
Following sharp gains the past two days and higher prices in early morning trading, futures were encountering some late week selling pressure. The trade may be taking note of news that the government of Argentina is forecasting this year’s soybean crop in the range of 55 mmt to 58 mmt. The upper end is 3 mmt greater than the USDA forecast. Soybean oil futures are selling down along with a lower trend mid morning for crude oil futures. Also, large losses in the stock market on the 25th anniversary of the 1987 Crash are weighing on commodity sentiment and prices. November soybeans were recently down 11 cents at $15.34 1/2.
Futures are higher in midday trade after Ukrainian officials fulfilled a longstanding warning they may have to cut off wheat exports due to tight supplies. They said they end shipments Nov. 15th. However, they’ve already shipped 3.5 million tonnes and think they may yet ship another 1.5 million by the Nov. 15th cut-off; putting them at 5 million before they hang out the “sold out” sign. Yet USDA only forecast 4.0 mmt in exports from the Ukraine in the past two WASDE reports. Even if they decided to halt shipments immediately they’d only be 500,000 tonnes shy of what’s “in the market” based on USDA WASDE estimates. December Chicago wheat is 13 cents higher at $8.81 ½. KC December is 9 ¾ cents higher at $9.14 ½ and Minneapolis is 7 ¾ cents higher at $9.51 ¾.
Cattle futures are lower on profit-taking after gains earlier this week and ahead of the Cattle on Feed report this afternoon. Underlying factors remain positive. Beef prices are strong and light cash trade in Texas is reported at $127, up $2 from last week. In addition to cattle on feed, the Cold Storage report is expected to show a slight decline in frozen beef stocks. December cattle futures are 77 points lower at $127.27 and February is 50 points lower at $130.92.
Lean hog futures are trading higher at midday. Futures prices are getting strength from the cash market which posted solid gains on Thursday. Even with high slaughter rates the hog prices continue to move counter-seasonally higher. That clearly suggests strong demand for pork. The December contract is up 60 cents at $79.45 and June is 35 cents higher at $100.90.
Futures are quiet and subdued in midday trade, mostly a bit lower. This follows three straight days of tremendous market volatility in daily trading ranges exceeding 4 cents per pound. Volume suddenly tripled after major market participants became aware that with less than a third of the harvest in, there are significant problems with micronaire (fiber thickness) in this year’s crop with only 15% of the crop estimated to be of deliverable grade against futures. This led to panicky short covering by hedgers, fearful that mills might decide to take delivery against long positions. And awareness of that possibility in turn stimulated aggressive short-covering by funds in no position whatever to make delivery. It’s expected to prove a temporary shortage, however, once harvest is complete. December cotton is 1 point lower at 77.71.