Ag markets were surprisingly mixed Tuesday night

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Corn futures continued their recent advance early Wednesday morning. The same forces powering the late corn rally persisted Tuesday night, with tight old crop conditions boosting the nearby contracts. Moreover, fears of an echo of the 2012 drought in the form of a late-July heat wave boosted new crop prices, since hot, dry conditions at that time might curtail pollination. September corn futures rose 4.0 cents to $5.5575/bushel in early Wednesday trading, while December gained 2.75 cents to $5.245.

Soybeans and meal remained generally strong in early Wednesday morning activity. The tight old crop situation seemingly continued supporting the expiring July contracts, although August futures actually declined slightly. That was pretty surprising especially in the wake of news that Chinese soybean imports set a record at 6.93 million tonnes last month. Weak palm oil markets seemed to undercut soyoil as well. Weather concerns rather obviously boosted deferred soybean and meal values. August soybean futures slipped 3.0 cents to $14.6525/bushel in overnight action, while August soymeal was unchanged at $448.9/ton, and August soybean oil edged 0.13 cents lower to 46.89 cents/pound.

Export hopes seemed to support wheat markets again Tuesday night. Recent announcements of strong Chinese wheat buying have boosted U.S. prices lately. Shortfalls in the Russian crop, as well as concerns about U.S. spring wheat, also seemed to boost domestic values. September CBOT wheat inched up 0.75 cents to $6.7825/bushel just after sunrise Wednesday, while September KCBT wheat advanced 3.0 cents to $7.0675, and September MGE futures added 2.25 cents to $7.71.

Cattle futures were narrowly mixed early Wednesday morning. That probably reflects industry uncertainty about the short-term cash outlook, as well as the mixed nature of Tuesday afternoon wholesale quotes. Meanwhile, feeder futures continued their late decline in response to concerns about the forthcoming corn crop and the ongoing rally in that pit. August cattle inched 0.02 cents lower to 122.70 cents/pound as the sun rose over Chicago Wednesday, while December slid 0.15 cents to 128.52. August feeder futures dropped 0.55 cents to 150.60 cents/pound, and November fell 0.42 cents to 155.75.

The hog market also posted an indecisive showing overnight. Fresh wholesale losses were almost surely a negative factor, but cash firmness very likely supported the nearby contracts. That is, the CME lean hog index remains quite elevated and well above everything on the Chicago board. That probably explains the nearby futures gains. August hog futures moved up 0.07 cents to 95.25 cents/pound early Wednesday morning, while the December contract crept up 0.02 cents to 81.12.

Cotton futures dipped in Tuesday night trading. There was little news concerning the white fiber market, so the slippage probably reflected concurrent weakness in the equity index futures, since those have negative implications for future apparel demand. On the other hand, the U.S. dollar also declined overnight, which might easily have supported white fiber values. October cotton was unchanged at 86.68 cents/pound in early Wednesday trading, while December skidded 0.16 cents to 85.82.



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