Harvest pressure seemingly continues weighing on the corn market, with storage reportedly becoming an issue in many areas. Traders were probably somewhat reluctant to be very aggressive prior today’s weekly Export Sales report. In addition, stocks and the dollar surged late Wednesday afternoon after the Federal Reserve left U.S. interest rates unchanged but continued threatening to boost rates in December. Those markets reversed overnight, thereby adding to uncertainty. The fact that December corn futures fell below their 50-day MA yesterday isn’t encouraging either. December corn futures stalled at $3.76/bushel Wednesday night, while March was also unchanged at $3.86.
Wire service sources cited bargain buying for boosting the soy complex overnight. As discussed early this week, recent Brazilian weather has turned more favorable soybean production, thereby implying another record South American crop, which in turn has weighed on soy prices. However, buyers almost surely need beans before then, so the dip may have encouraged buying. Thus, bulls may be buying in anticipation of strong results on today’s report. November soybeans edged up 2.0 cents to $8.835/bushel in early Thursday action, while December soyoil gained 0.09 cents to 28.20 cents/pound and December meal rose $1.3 to $301.20.
Wheat traders were probably somewhat disappointed but not surprised by news surrounding an open Egyptian tender for wheat. No American wheat was even offered, but the fact that it’s not very competitive on the international market has been a common theme in recent months. And yet, bears could generate no downward momentum overnight. One has to suspect selling interest is rather limited at this point, especially after the market soundly rejected Wednesday’s test of the $5.00 level in December CBOT futures. December CBOT wheat futures sagged 0.25 cents to $5.0575/bushel in pre-dawn Thursday trading, while Dec KC wheat skidded 0.5 cents to $4.85, and December MWE slid 0.75 cents to $5.1525.
Tuesday afternoon reports indicated southern Plains cattle had traded at steady prices, which topped genera industry expectations for this week’s cash action. Moreover, beef packers’ willingness to pay steady money this early in the week strongly suggests they needed those animals rather badly. The big 2.35-cent jump in choice cutout at noon almost surely encouraged bulls as well. December and February live cattle futures leapt the 3.00-cent daily limit at Wednesday’s close, ending the day at 139.67 and 145.37 cents/pound, respectively. November and January feeder cattle spiked their 4.50-cent limits, respectively settling at 192.25 and 194.65 cents/pound.
Ongoing cash market slippage and expectations for much more of the same seemed to keep the pressure on CME lean hog futures Wednesday. The big gain posted by the U.S. dollar index wasn’t very encouraging either. Still, the big cattle and feeder market surge probably offered spillover support to swine values. That fact, as well as the sizeable discount already built into nearby futures seemingly enable the December contract to post a modest gain. December hog futures closed up 0.15 cents to 61.405 cents/pound Wednesday afternoon, while April hogs dropped 0.50 to 68.52.
Financial markets probably affected cotton futures Wednesday. Given the impact changing economic conditions can have on apparel demand, cotton traders pay close attention to stock market action. Thus, today’s big rise posted by the equity indexes seemed to translate into the fiber market as well. Conversely, the concurrent U.S. dollar surge threatened exports. Technicians apparently favored the bullish side, especially after the nearby December contract bounced from its 40-day moving average in early trading. December cotton futures ended Wednesday having rallied 0.33 cents to 62.67 cents/pound, while May cotton added 0.30 cents to 62.46.