Corn again followed soybeans and wheat higher Wednesday night. Little fresh news concerning corn emerged overnight, although a report of reduced Mexican imports looks somewhat bearish. CBOT futures rallied instead and rather obviously seemed to be tracking gains in the soy and wheat complexes. Traders may also be anticipating a bullish follow-through from Wednesday’s stock gains/dollar decline. May corn futures gained 1.75 cents at $3.775/bushel in early Thursday action, while December rose 2.0 to $4.02.
The soy complex continued rising as well. South American supplies are still flooding onto the global soy markets, which clearly is not conducive to big price rallies. But that obviously didn’t prevent Chicago prices from responding well to Wednesday’s Fed news and subsequent financial market events. CBOT futures stayed the course overnight despite equity slippage and dollar firmness. Palm oil gains likely supported soyoil quotes, whereas underlying demand strength may still be underpinning beans and meal. May soybean futures climbed 4.5 cents to $9.695/bushel Wednesday night, while May soyoil advanced 0.15 cents to 30.78 cents/pound, and May meal edged up $2.1 to $322.9/ton.
Chinese news appeared to boost the wheat markets. Wednesday’s financial market developments exaggerated wheat gains associated with weather worries. That bullishness is likely persisting, but bulls also got a big boost from Chinese news. That country’s officials have reportedly bought 450,000 tonnes of high protein wheat in the past week, with 300,000 tonnes coming from Canada. That essentially tightens the whole North American market. May CBOT wheat rallied 2.5 cents to $5.13/bushel early Thursday morning, while May KC wheat moved up 4.5 cents to $5.575/bushel, and May MWE wheat added 4.5 to $5.825.
Cattle futures posted an impressive advance Wednesday. Live cattle futures traded firmly yesterday morning, with traders citing bull spreading and short-covering for the rise. Still, fresh expectations for seasonal cash and wholesale strength probably played a role in the late-morning breakout to the upside. Financial market action encouraged bulls as well. One has to wonder if the rally will persist in the face of Wednesday’s late beef slippage. April cattle futures leapt the 3.0-cent daily limit to 156.57 cents/pound at Wednesday’s CME close, while August cattle jumped 2.85 cents to 146.40 cents/pound. Meanwhile, April and August feeder cattle futures spiked their 4.50-cent daily limits to 214.30 and 214.37 cents/pound, respectively.
Hogs clearly lagged the other markets. In contrast to the big gains posted by the other ag markets, hog futures closed poorly. That very likely reflected industry pessimism about short-term prospects for the cash and wholesale markets. Traders apparently expect big supplies to overwhelm seasonally improving demand. Weak afternoon reports weighed on nearby futures in GLOBEX trading. April hog futures ended Wednesday having fallen 1.07 cents to 60.70 cents/pound, while June hogs sank 0.67 to 75.12.
Cotton traded in mixed fashion Wednesday night. Yesterday’s Fed statement and the outsized financial market reaction looked bullish for the cotton outlook, since those developments implied persistently strong demand. The fact that cotton futures had broken out technically before the Fed news exaggerated the surge. Prices were narrowly mixed overnight, due in part to modest reversals by equity index futures and the dollar. ICE slippage after the big move was also to be expected. May cotton inched up 0.01 cent higher to 62.49 cents/pound shortly after dawn Thursday, while December futures sank 0.20 to 63.47.