News of another big sale boosted corn futures Friday morning. Corn futures seemed to rally on pre-weekend short covering Thursday night. Bulls then got good news when the USDA daily system reported the sale of 101,600 tonnes to an ‘unknown destination.’ Ultimately, recent corn losses have triggered active buying, which indicates significant demand strength. March corn futures gained 5.0 cents to $3.85/bushel late Friday morning, while July moved up 5.5 to $3.99.
Chinese news undercut soybean and meal prices. The soy complex also proved firm overnight, but traders became much more tentative when the USDA announced that Chinese buyers had cancelled soybean sales of 285,000 tonnes scheduled for this year. The implication that bean prices are too high clearly created concerns amongst CBOT traders. In contrast, rising crude oil and equity index prices appeared to encourage buyers in the soyoil market. March soybean futures edged up 0.75 cent to $9.9175/bushel around midsession Friday, while March soyoil rallied 0.20 to 33.19 cents/pound, and March meal added $0.8 to $327.5/ton.
Short covering seemingly boosted the wheat markets. Wheat futures are probably benefiting from strength spilling over from the corn pit, with midmorning gains in the energy and equity sectors seemingly encouraging bulls as well. In addition, bears are probably taking profits on recently establish shorts before the weekend. March CBOT wheat rose 2.75 cents to $5.3525/bushel as the lunch hour loomed Friday, while March KC wheat surged 5.5 cents to $5.785/bushel, and March MWE wheat lifted 4.25 to $5.8525.
Falling cash prices continued weighing on cattle futures. This week’s futures-led breakdown in country cattle prices is cycling back into the Chicago market, with traders likely believing they’ll see more of the same next week. Some technical techniques also suggest futures are vulnerable to further short-term losses despite near-record beef values reached this week. February live cattle futures slipped 0.05 cents to 154.15 cents/pound in late Friday morning action, while the April contract dropped 0.57 cents to 152.22. January feeder cattle futures plunged 1.40 cents to 214.25, but March feeders ran up 0.30 to 205.90.
CME hogs turned lower once again. Although cash hog prices were called steady this morning, which seemed comparable to the generally stability seen Thursday afternoon, CME futures moved substantially lower once again. One has to suspect industry insiders are hearing more bearish indications. February hog futures dove 0.90 cents to 74.72 cents/pound just before lunchtime Friday, while June hogs fell 0.82 cents to 87.10.