Corn futures are trading lower at midday. Traders are selling ahead of Tuesday’s USDA Supply/Demand report. Technical factors are contributing to the selling as well, with traders looking to reduce their market risk exposure. Corn planting is progressing at a fast pace, which is adding to the selling pressure. Traders are looking for a cut in ending stocks to around 717 million bushels, down from 801 million. Corn export inspections of 23.4 million bushels were down considerably from the previous week. May corn is 8 3/4 cents lower at $6.49 1/2 and December is 4 1/4 cents lower at $5.46.
Soybean futures are trading lower at midsession. A number of global markets are seeing selling pressure on Monday. The selling is linked to disappointment over Friday’s employment report and weekend news of higher than expected inflation data out of China. USDA issues its April supply/demand analysis on Tuesday morning. The trade expects USDA to reduce its forecast of ending stocks by about 30 million bushels from the last forecast at 275 million. The May contract is 8 1/2 cents lower at $14.25 1/2 and November is 4 1/4 cents lower at $13.77 1/4.
Wheat futures are trading mostly lower at midday Monday. The frost threat for last night and tonight turned out to be a non-event for winter wheat. Slight losses at the MGE are mostly the result of that, plus expectations for planting progress to continue faster than normal, which often means acreage exceeding what was in the March 30th prospective plantings report. Another feature of mixed trade in wheat today is positioning ahead of tomorrow morning’s Supply/Demand revisions for April from USDA. A drop in ending stocks is expected for wheat; it’s a matter of whether it meets, exceeds, or falls short of pre-report expectations. CBOT May is 1 1/4 cents lower at $6.37; KCBOT May is 1 3/4 cents lower at $6.60 1/4, and MGE May is 5 cents lower at $8.41.
Cattle futures are trading higher at midday. Futures are bouncing back as buyers are taking advantage of the sharp sell-off that dropped prices nearly $7 in 5 sessions. The beef cutout value has been sharply lower as well and processing margins are very poor. Recent developments, especially the uproar over the use of lean finely textured beef, i.e. pink slime, has dampened demand for hamburger and about have the beef sold is sold as hamburger. While the controversy is dying down, there are few signs consumers are coming back to beef. Beef demand usually improves after Easter, but this may not be a typical year. April cattle futures are 73 cents higher at $119.05 and June is up 8 cents at $115.90.
Lean hog futures are mixed but mostly higher at midday. Deferred contracts are posting solid gains with traders optimistic about the potential for demand to finally improve. Cash hog prices did move higher last week, but the pork cutout value declined. But hog prices typically rise in April and May and the problems facing the beef market may give hog prices and extra boost this year. Hog futures are clearly trending higher and further gains are likely if pork cutout values can get some traction. The May contract is 3 cents lower at $94.20 and June is up 13 cents, also at $93.65.
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