Hot weather forecasts sent crop prices soaring Monday morning

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The crop markets shot upward Sunday night. Traders believe recent dryness has set the stage for substantial crop damage over much of the Corn Belt this week, when temperatures seem set to reach their highest levels for 2013. The corn market was certainly not exception. September corn leapt 16.0 cents to $5.115/bushel early Monday morning, while December soared 21.0 cents to $4.91.

The soy complex also spiked upward in early-week trading. The soybean and product markets led the way upward Sunday night, which is entirely understandable, since this time of year is probably much more critical to the size of the bean crop than for its counterparts. September soybeans exploded 52.75 cents higher to $14.18/bushel as the sun rose over Chicago Monday, while November beans zoomed up 55.25 to $13.84. September soyoil jumped 1.27 cents to 43.91 cents/pound, and September soymeal rocketed up $18.9 to $452.1/ton.

Wheat futures again followed corn and soybeans higher again last night. News that Saudi Arabia had accepted a surprisingly large tender over the weekend probably supported wheat futures to start the week, but it was quite obvious that strength spilling over from the corn and soy pits were powering golden grain values upward as well. September CBOT wheat jumped 12.25 cents to $6.4675/bushel in early Monday action, while September KCBT wheat climbed 10.25 cents to $7.0575, and September MGE futures added 9.0 cents to $7.2525.

Cattle futures declined as trading wound down last Friday. Traders seemed to be evening up positions prior to the release of the monthly USDA Cattle on Feed report. It stated July placements 10% below last year, with the COF total down 6%, both of which seem quite bullish for December futures. Thus, we should probably expect a strong opening this morning. October cattle futures ended Friday 0.50 cents lower at 126.70 cents/pound, and December matched the decline, falling to 129.22. September feeder cattle futures sank 1.05 cents to 156.65 cents/pound, while November lost 0.92 to 159.52.

Hog futures bounced from technical support Friday. The monthly USDA Cold Storage report stated ending-July U.S. pork stocks well above forecasts, which seemingly exaggerated recent selling in early action. However, futures rallied substantially after December bounced from firm support around the 81.00-cent level. That may bode rather well for short-term prospects. October hog futures advanced 0.70 cents to 85.10 cents/pound at their week-ending settlement, while December surged 0.65 cents to 82.25.

The cotton market also followed corn and beans higher Monday morning. Although the short-term weather outlook for the major cotton growing areas of the U.S. are not particularly threatening, and imply little change from recent conditions, cotton futures rose moderately overnight. That certainly seemed to reflect concurrent gains in the soybean and corn markets. December cotton futures gained 0.53 cents to 84.61 cents/pound to start the week, while March rose 0.35 cents to 83.85.



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