Forecasts for summery weather boosted corn futures again overnight. Benign weather and favorable forecasts depressed the crop markets, particularly corn in late June and early July, but the latest predictions have tended toward hotter and drier conditions. That environment might do great damage to crop prospects if it occurs while the corn plants are pollinating. Thus, corn futures rallied again Monday night. September corn futures climbed 9.25 cents to $5.425/bushel early Tuesday morning, while December added 7.5 cents to $5.08.
Soybean futures also responded strongly to weather forecasts. Although mid-to-late-July heat can be less damaging to the incipient soybean crop. However, memories of the severe conditions experienced in mid-2012 are probably spurring active buying of the soybean complex as traders build a weather premium into the market. August soybean futures jumped 16.5 cents to $14.72/bushel in early Tuesday trading, while August soybean oil inched up 0.23 cents to 47.19 cents/pound, and August soymeal surged $6.2 to $448.3/ton.
Bullish news continues supporting the wheat markets. China has bought 1.3 million tonnes of U.S. wheat since last Wednesday, with their 840,000-tonne total for Monday being the largest single-day purchase since 2004. Meanwhile, drought is reportedly reducing the Russian crop, while harvest totals out of northwest Kansas are coming in at surprisingly small levels. September CBOT wheat rallied 5.25 cents to $6.6825/bushel just after dawn Tuesday, while September KCBT wheat gained 5.25 cents to $6.9425, and September MGE futures lifted 5.0 cents to $7.66.
Cattle futures were mixed in Monday night trading. Bullish traders have been supporting the cattle market lately, thinking the summer lows might be in. However, Monday afternoon news of a sizeable drop in beef cutout values apparently undermined the CME market. August cattle edged up 0.15 cents to 122.22 cents/pound in early Tuesday electronic trading, while December slipped 0.20 cents to 128.25. August feeder futures sank 0.25 cents to 151.35 cents/pound, while November declined 0.20 cents to 56.57.
Hog futures rebounded modestly Tuesday morning. Recent wholesale weakness had dragged the hog and pork complex lower Monday, with pessimism about summer price prospects weighing heavily upon the CME market. However, pork cutout posted a surprising bullish reversal after the Monday afternoon close, so it was not terribly surprising to see futures rebound in early trading. August hog futures bounced 0.30 cents to 95.85 cents/pound as the sun rose over Chicago Tuesday, while the December contract crept up 0.10 to 81.05.
Cotton futures bounced in reaction to the Crop Progress report overnight. The weekly USDA Crop Progress report indicated a significant reduction in the percentage of the current cotton crop rated good to excellent. Moreover, the percentage rated poor to very poor rose substantially, thereby indicating current conditions are putting a great deal of stress on cotton plants. As one would expect, Ice cotton futures are rallying on the news. October cotton rose 0.33 cents to 86.70 cents/pound in early Tuesday morning trading, while December slipped 0.06 cents to 85.27.