Corn futures firmed overnight as the markets continue to seek direction in the midst of turmoil. The world markets traded mixed Wednesday with the Shanghai Composite down 1.3.% and the Shenzhen down 3.0%. U.S. index futures are higher early Wednesday morning with DJ mini up 1.9% and the Nasdaq mini up 2.2%, suggesting higher open today. Weather doesn’t show signs of challenging what looks to be a large crop. Some analysts feel corn could be approaching a bottom, yet for Dec corn to surpass $4 may be challenging. September corn futures climbed 2.55 cents to $3.68/bushel Tuesday, while December lifted 2.25 cents to $3.7925.
Soybean futures slipped further yet as the September, November, and January contracts all forge new lows. The previous low close the new-crop Nov contract was 9.02 from late May 2015. On a continuous nearby basis, prices are testing lows from Feb 2009, despite news this week of 330,000 tonnes of new-crop soybean sales to unknown buyers. Year-over-year, the export pace is lagging but consensus seems to be that China will accelerate buying in Q4. Argentine farmers are two days into their five-day pre-election strike. September futures fell 3.5 cents to $8.9075/bushel early Wednesday, while September soyoil dropped .37 cents to 26.45 cents/pound and September meal climbed $0.4 to $328/ton.
Wheat futures were stronger early Wednesday morning after getting hit hard yesterday. The global supply outlook remains plentiful as EUS wheat prices has continue to drop, pulling corn demand down as producers take advantage of cheaper feed sources. Weather and spring wheat harvest progress appear to optimal and will likely limit near-term gains. Still, the Sep Chicago wheat contract is trading 25 cents higher than the low for the contract set early May 2015, at 4.74. September CBOT wheat futures gained 3.75 cents to $4.9875/bushel early Wednesday, while Sep KC wheat rose 4.5 cents to $4.705/bushel, and September MWE lifted 3.75 cents to $5.005.
Live cattle edged lower Tuesday after a falling sharply lower Monday. Boxed-beef values were lower as were OKC live steer values. Nearby cattle are way lower that the 50, 100, and 200-day moving averages and are challenging the Q3 low of 143.02 hit on July 27, also the lowest since June 2014. October cattle dropped 1.67 cents to 142.32 cents/pound Monday, while April futures fell 2.02 cents to 142.90. Meanwhile, October feeder cattle futures dropped lower 4.65 cents to 194.90 cents/pound Monday, while January feeders lost 4.12 cents to 187.35.
Nearby lean hogs surged another 2% Tuesday after surging over 5% Monday, making it apparent that pre-holiday buying may have yet to peak. It remains to be seen how long hogs will rally, but traders still anticipate a sharp fall-off in demand. Nearby futures still sit well below each of the 50, 100, and 200-day moving averages and 11 cents below the lean hog index. Cash hog values were lower by 38 cents over Monday to 73.55. October hog futures gained 3 cents to 65.82 cents/pound Tuesday, while February lifted 2.52 cents to 66.75.
The cotton market eased again early Wednesday morning after falling in late-day trading Tuesday. The tighter than expected balance sheet for cotton and the drop in the condition rating have given cotton bulls something to talk about as of late but world market problems are now the driver. While the global scene for cotton is largely still plagued by oversupply, the recent bullish data appears to be giving way to world economic and currency struggles, particularly related to Chinese demand fears. December cotton futures were unchanged at 63.16 cents/pound Wednesday, while May fell 0.27 cents to 62.98.
