U.S. Lean Hogs Settle up on Tight Supply; Live Cattle Falls 2%
U.S. lean hog futures were mixed Wednesday as demand concerns and technical pressure are offset by tightening supplies. CME lean hogs for June closed up 0.025 cents to 93.55 cents per pound, while August lean hogs were down 0.25 cents to 91.5 cents per pound.
U.S. live-cattle futures sank Wednesday, dropping 2% on worries about beef demand and technical liquidation, analysts said. CME live cattle for June ended down 2.45 cents to $1.171 per pound, while CME August feeder cattle fell 2.8 cents to $1.5835.
U.S. wheat futures closed higher Wednesday morning, as traders weigh lower corn prices against lower expected Australian wheat production. In electronic trading, Chicago Board of Trade futures for July delivery were up 1 1/4 cents at $6.17 1/4 a bushel. Kansas City Board of Trade July wheat were up 1 1/2 cents at $6.42 1/4 a bushel. MGEX July wheat closed up one cent at $7.65 1/4 a bushel.
US soy futures continue to trade lower after open-outcry trading opens, pressured by an improved weather outlook with greater likelihood of rain next week, which would benefit soy crops early in the growing season. Front-month corn futures up on worries about tight supplies before the US harvest this fall, but deferred corn's lower on favorable weather forecasts. Wheat up on lower expected production in Australia, reducing competition for US exports. CBOT July soybeans down 16 1/4c at $14.18 3/4 a bushel; July corn up 2 1/2c at $5.86 1/2; CBOT July wheat up 5 3/4c at $6.21 3/4 a bushel.
Price difference between cotton for July delivery and December narrowed sharply from more than 670 points — a nine-month high — hit in the previous session. The wide spread "left many traders short the December and opened the way for today's sharp technical rally despite the bearish fundamentals that have attracted sellers to December the last two months," says cotton analyst Mike Stevens. December prices are tied to the upcoming harvest — a season marked by bearish fundamentals. Concern is growing, however, that there will be less cotton than thought as farmers plant less due to recent price decline. July delivery on ICE fell 0.6% to 75.09c/lb; December cotton gained 2.3% to end at 70.41c/lb.
Crude oil futures prices settled at a fresh eight-month low Wednesday ahead of a meeting to discuss oil output among the Organization of Petroleum Exporting Countries. The group, consisting of the world's biggest oil exporters, is expected to keep production unchanged at historically high levels when it meets in Vienna Thursday. Light, sweet crude for July delivery settled 70 cents, or 0.8%, lower at $82.62 a barrel on the New York Mercantile Exchange, its lowest settlement since Oct. 6. Brent crude on the ICE futures exchange settled 1 cent lower at $97.13, a fresh 17-month low. Front-month July reformulated gasoline blendstock, or RBOB, settled 0.52 cent, or 0.2%, higher at $2.6554 a gallon. July heating oil settled 1.06 cents, or 0.4%, lower at $2.6109 a gallon.
Natural gas futures fell to a six-week low Wednesday as forecasts called for cooler weather ahead, signaling a drop in demand for the fuel. Natural gas for July delivery dropped 4.7 cents, or 2.1%, to settle at $2.185 per million British thermal units on the New York Mercantile Exchange. Natural gas prices often fluctuate with temperatures in the summer months.
Gold moved slightly higher on a weaker dollar Wednesday, though euro-zone worries reined in the rise of gold prices as investors turned to Treasurys for security. The most actively traded contract, for August delivery, gained 0.4%, or $5.60, to settle at $1,619.40 per troy ounce on the Comex division of the New York Mercantile Exchange. Gold prices have edged higher as the dollar drifted lower against the euro in recent days.
Wall Street ended lower on Wednesday as fears ahead of the Greek elections over the weekend drove down the markets. The Dow Jones industrial average dropped 77 points at 12,496. The Standard & Poor's 500 Index fell 9 points at 1,314. The Nasdaq Composite Index lost 24.46 points at 2,818.