Corn already seems stuck in holiday trading. Early Monday news of a sizeable corn sale and the strong Export Inspections result rather clearly supported the corn market yesterday. However, prices were confined to a very tight range and barely budged overnight. The market seems likely to remain well supported in the short-term, but it may not move much when significant news isn’t driving prices. March corn futures slipped 0.25 cent to $4.115/bushel Monday night, while July skidded 0.5 to $4.2625.
The soy complex posted a mixed showing Monday night. Optimism about demand strength is likely supporting soybean meal and bean futures at this point, although the prospect of another record Brazilian crop seemingly weighed on prices overnight. The ongoing palm oil advance likely powered modest bean oil gains. As in the other markets, we can probably expect subdued soy market action during the holiday season. January soybean futures slid 3.0 cents to $10.3525/bushel early Tuesday morning, while January soyoil rose 0.05 to 32.09 cents/pound, and January meal inched up $0.1 to $368.5/ton.
Talk of reduced Russian exports continues supporting wheat prices. There was little fresh news out of Russia last night, but traders were still talking about prospects for reduced sales and the implied need for grain from other exporters. That rather clearly supported wheat futures again despite the ugly reversals posted last Friday and again yesterday. Having the traditional U.S. dollar index reach its highest level since March 2006 may also have limited gains. March CBOT wheat gained 2.75 cents to $6.285/bushel in pre-dawn Tuesday action, while March KC wheat edged up 1.75 cents to $6.595/bushel and March MWE wheat climbed 5.5 to $6.505.
Cattle futures set back from Monday’s early highs. Technical and pragmatic factors seemed to power big early gains in cattle futures, since the latest news, particularly last Friday’s Cattle on Feed report, was not very supportive. Futures couldn’t sustain early highs, but bears could generate little follow-through to the downside. Afternoon beef reports and GLOBEX action suggest a stronger opening today. February live cattle ended Monday having risen 0.72 cents to 160.82 cents/pound, while April futures climbed 0.55 cents to 160.22. January feeder cattle futures improved 0.35 cents to 220.50 cents/pound and March feeders jumped 1.00 cent to 218.97.
Seasonal weakness seemed to weigh on hogs again Monday. Although last Friday’s late spot quotes seemed supportive of CME swine futures yesterday, the Chicago market proved surprisingly weak in early trading. That probably reflected industry talk of cash weakness and seasonal ham losses now that grocers have completed their holiday buying. Cash quotes did fall sharply, but pork cutouts rose significantly. That may lead to a firm opening. February hog futures plunged 1.65 cents to 80.25 cents/pound at their Monday settlement, while June hogs tumbled 1.35 cents to 89.07.
Economic optimism seems to be supporting cotton futures. Several equity indexes hit record highs Monday, thereby testifying to broad optimism about the economic outlook, particularly for the U.S. The implied strength of apparel demand also looks bullish for cotton usage. Those considerations, as well as the penetration of major moving average resistance powered yesterday’s ICE gains. Prices posted modest follow-through gains overnight. March cotton futures advanced 0.07 cents to 62.11 cents/pound just after dawn Tuesday, while the July contract lifted 0.10 to 63.20.