The commodity markets were generally weak Wednesday morning after a Chinese manufacturing report proved surprisingly weak. The losses in the crop markets may have been exaggerated by the first-day result from the first day of the Wheat Quality Council tour. That is, anticipated production from northeast Kansas probably exceeded expectations. July corn fell 6.0 cents to $6.44/bushel early Wednesday morning, while December dropped 5.75 cents to $5.51.
Soybean futures also followed through upon their Tuesday decline in early-Wednesday trading. As with corn, there was not a great deal of news pertinent to the legume market, especially with both European and Brazilian markets closed for holidays. An Oil World report implying record South American exports during May might be weighing upon prices somewhat. July soybean futures dove 13.0 cents to $13.86/bushel in overnight electronic action, while July soyoil slid 0.47 cents to 48.75 cents/pound and July soybean meal dipped $3.3 to $411.2/ton.
Wheat futures surged upward around midsession Tuesday in likely response to early indications from the Wheat Quality Council tour. However, indications that the wheat in northeast Kansas was better than was generally anticipated despite drought and frost seemingly dragged futures back downward early Wednesday morning. Reports from the western part of the state could tell a different tale, so traders should probably anticipate increased volatility through the balance of the week (although the tour ends Thursday afternoon). July CBOT wheat futures sank 11.75 cents to $7.1925/bushel in pre-dawn Wednesday trading, while July KCBT wheat lost 9.25 cents to $7.8025 and July MGE futures declined 7.75 cents to $8.1425.
Live cattle futures proved surprisingly weak Tuesday despite widespread optimism about the short-term outlook. Traders may have been more concerned about the possible course of events later in the spring, when the nearby June contract actually approaches expiration. Continued slippage overnight despite the Tuesday afternoon report of surprising wholesale strength is not encouraging. June cattle skidded 0.12 cents to 121.77 cents/pound in early Wednesday morning trading, while December lost 0.25 cents to 127.10. August feeder cattle futures inched 0.02 cents higher to 148.92 cents/pound overnight, while November slid 0.12 cents to 153.07.
Continued cash powered CME lean hog futures upward Tuesday. Not only is the CME cash equivalent price likely to jump again today, direct markets in the western Corn Belt duplicated recent gains Tuesday afternoon. However, a stunning drop in pork cutout late Tuesday afternoon undercut the market in overnight trading. A heavy reading for Iowa-Southern Minnesota pig weights on the early-morning report seems negative as well. June hog futures lost 0.52 cents to 92.05 cents/pound in early Wednesday action, while the December contract dipped 0.35 cents to 78.55.