Live cattle futures rose Wednesday as meat packers proved willing to pay high cash prices.
April futures rose 1.2% to $1.17700 a pound in Wednesday’s session on the Chicago Mercantile Exchange, reversing two days of losses and inching toward the highest close since late January.
But packers were forking out considerably more at the Fed Cattle Exchange auction on Wednesday morning, where 3,350 cattle sold for an average $1.28 a pound. That marked a considerable uptick from last week’s negotiations, in which a little over 500 cattle sold at an average of $1.24 per pound.
Lean hog futures backed away from gains made this week, however, with April contracts falling 1.1% to 70.075 cents a pound. Cash prices for hogs took a downward turn Tuesday and dealers were expecting them to trend lower this week. With wholesale pork prices also mixed, fewer signs of increasing demand couldn’t keep the rally going.
Soybean futures fell to a five-month low Wednesday on mounting evidence that big harvests elsewhere will continue to weigh on prices for U.S. producers.
U.S. soybean prices have been battered in recent days as traders trade off forecasts for a record Brazilian harvest that could muscle into U.S. export share.
May soybean futures fell 0.1%, to $9.98 a bushel, at the Chicago Board of Trade. That marked the lowest close for the oilseed since Oct. 14, with futures contracts shedding more than 50 cents a bushel so far this month.
Soybeans advanced slightly overnight, but gains were soon lost after data from a key trade group also showed the oilseed crush fall to the lowest rate since October. Processing fell to 142.8 million bushels in February from 160.6 million the previous month, the National Oilseed Processors Association reported.
Some analysts expect soybeans to continue drifting lower until a government planting intentions report on March 31, which could show U.S. farmers scaling back their oilseed acreage in response to the pessimistic outlook.
Wheat and corn rose Wednesday, however, as momentum to sell after last week’s government supply-and-demand report faltered and some positive developments reverberated around traders.
Wheat futures rose 1.3%, to $4.36 a bushel, on renewed weather concerns. A freeze that gripped parts of the U.S. plains was thought to have done some damage to the crop there, which was lured out of dormancy by unseasonably warm weather in January. With wheat stocks from old crops already at multiyear highs, traders were counting on some trouble with the new to support prices.
Corn was buoyed as international buyers, particularly China, stepped into the market for U.S. grain. That helped corn futures, which are also dealing with South American production concerns, edge up 0.4%, to $3.63 1/2 a bushel.
In particular, speculation that China’s already sizeable corn reserves weren’t of the appropriate quality to meet all of its needs sparked excitement in the U.S. market as traders placed bets that China could come back for more.
Cotton futures gained Wednesday after the China Cotton Association released data indicating robust demand for the fiber from the third largest cotton importer.
Cotton for May delivery rose 1.2% to settle at 78.08 cents a pound on the ICE Futures U.S. exchange.
Oil prices rose Wednesday, snapping a week-long losing streak, as a drop in U.S. stockpiles supported a rally from Tuesday’s three-month lows.
Light, sweet crude for April delivery settled up $1.14, or 2.4%, at $48.86 a barrel on the New York Mercantile Exchange. That is its biggest one-day gain since Jan. 11. Brent crude, the global benchmark, gained 89 cents, or 1.7%, to $51.81 a barrel on ICE Futures Europe.
Gasoline futures flipped to losses after the data release and finished down 0.01%, to $1.5834 a gallon. It is now down in five of the past six sessions. Diesel futures gained 1.4%, to $1.5124 a gallon, snapping a five-session losing streak.
Natural-gas prices rose Wednesday for the fourth time in five sessions with slightly cooler weather forecasts for late March stoking demand expectations.
Natural gas for April delivery settled up 4.3 cents, or 1.5%, at $2.981 a million British thermal units on the New York Mercantile Exchange. The past week’s gains are part of a winning string going back to late February, and natural gas is now up 16% in just a little more than four weeks. March weather has returned to normal after a historically mild February, helping spark the recent gains.
Gold prices rose to a one-week high on Wednesday after the Federal Reserve raised short-term interest rates and kept the outlook for additional rate increases this year unchanged.
Gold for April delivery rose 0.8% to $1,212.40 a troy ounce in electronic trading, reversing losses after settling down 0.2% at $1,200.70 on the Comex division of the New York Mercantile Exchange.
U.S. stocks extended gains while bond yields and the dollar fell after the Federal Reserve decided to raise interest rates.
The Dow Jones Industrial Average rose 113 points, or 0.5%, to 20950. The S&P 500 added 0.8% to 2385 and Nasdaq Composite gained 0.7% to 5900.