The US Agri Recap: 12 October 2011

Soybean futures spent the day on both sides of the flat line Wednesday, but closed 1.25 to 4 cents higher in the Nov through Jul 2012 contracts. Far-deferred futures ended modestly lower. USDA surprisingly lowered its Y 2011 crop estimate and its M-Y 2011-12 carryover projection this morning. That gave the report data a Bullish read.

Another highly volatile day of trade was seen in the Corn market, with futures closing 4.25 to 7.50 cents lower, which was mid-range on the day. Futures saw light follow through in overnight trade from yesterday's sharp to limit higher performance, but opened the day session with sharp losses in reaction to this morning USDA reports.

Wheat futures were the downside leader in the grain market today. Chicago and Minneapolis Wheat closed mostly 20- to 30-plus cents lower while Kansas City saw slightly lighter losses. USDA's Supply & Demand Report had no shortage of bearish news for Wheat traders this morning. It raised both its US and World carryover estimates from last month.

Cotton futures settled with losses of 248 to 296 pts in most contracts on pressure from this morning's USDA reports. The Cotton components of today's Crop Production Report provided some of the biggest surprises, as USDA raised its average yield estimate by 2 lbs. per acre and left harvested and planted acreage unchanged from Sept.

Lean Hog futures closed steady in the Oct contract, 67.50 cents higher in the Dec contract and steady to slightly lower in the deferred contracts. Price action was choppy in the lean Hog market today. Selling interest in Oct and Dec Hogs was limited by the discount those contracts hold to the cash index.

Live Cattle futures favored a weaker tone throughout the day, with the Oct through Aug contracts closing 0.05 to 0.90 lower. Deferreds were firmer amid spreading. Feeder futures closed mixed. Live Cattle faced profit-taking following yesterday's gains as well as uncertainty surrounding where this week's cash Cattle will trade.

Paul A. Ebeling, Jnr.