Fed News Boosts Prices

U.S. wheat futures rose Friday, boosted by a weaker dollar and optimism about stronger export demand.
Chicago Board of Trade wheat futures for December delivery settled up 22 1/4 cents, or 2.5%, at $9.24 1/4 a bushel. September futures, which expired Friday, settled up 18 1/2 cents, or 2.1%, at $8.97 1/2 a bushel. Kansas City Board of Trade December wheat rose 25 1/4 cents, or 2.7%, to $9.48 a bushel. MGEX December wheat rose 15 1/2 cents, or 1.6%, to $9.78 a bushel.

Lean-hog futures extended their current rally to five straight days following signs of stability in once-reeling markets for hogs. October hog futures gained 0.6% to 74.02 cents a pound Friday and rose a total of 3.7% during the week. December hogs soared 2.1% to close at 73.9 cents, up nearly 5% on the week.

U.S. live-cattle futures continued falling back to earth Friday in the wake of six-month highs, as poor operating margins at beef packers gave traders reason for caution. It was a bit of a wild ride for the live-cattle futures market last week as they followed prices in cash-cattle markets to a series of historic highs only to have traders exit many positions before the weekend. As of Thursday morning, front-month futures were up 1.6% on the week, but they settled Friday up just 0.5% on the week. On Friday, cattle for October delivery closed down 0.4% at $1.2705 a pound at the Chicago Mercantile Exchange. December cattle shed 0.3% to close at $1.2992.
 

Soybean futures traded higher in the morning but also fell midday, as traders said some market participants performed spread trades buying corn and selling soybeans. Some market participants also sold soybean futures to exit bets on higher prices, booking gains on price increases from earlier in the week, traders said.
November soybean futures settled down 8 1/4 cents, or 0.5%, at $17.39 a bushel. Now-expired September soybeans settled down seven cents, or 0.4%, at $17.36 1/2 a bushel.

Cotton futures, which are particularly sensitive to economic data, took off after the Fed announced further quantitative easing to stimulate the US economy. "Today was a Bernanke rally," says independent analyst Mike Stevens. "[Shorts] were scrambling to get out." He adds that the market is likely being supported by continued Chinese buying. "It sets up anticipation for another decent export number next week," he says. Stevens expects to see prices at 77c/lb. near-term. ICE cotton for Dec delivery settled 3.2% higher at 75.90c/lb, a high since Sept 7.

At the livestock auctions held Thursday at Smithfield a total of 569 cattle and no goats were sold. Slaughter cows trended mixed, feeder steers and feeder heifers trended mixed when compared to last week’s sales. Average dressing slaughter cows brought $65.00 – $83.00 with high dressing up to $83.00. Average dressing slaughter bulls, 1000 lbs. & up, sold at $83.00 to $96.00. M&L 1-2 feeder steers, 400-500 lbs. brought $120.00 to $145.00, 500-600 lbs. brought $121.00 to $132.00. 400-500 lb. M&L 1-2 feeder heifers ranged $110.00 – $133.00 and 500-600 lbs. were $104.00 – $127.00.

STATE GRADED CATTLE SALE: At the state graded feeder cattle sale in Norwood, a total of 571 steers and 414 heifers were sold. M&L 1 steers, 400-500 lbs 153.57 per cwt.; 500-600 lbs 136.52; 600-700 lbs 132.25. M&L-1 heifers, 400-500 lbs 133.41; 500-600 lbs 130.80; 600-700 lbs 126.17.

No. 2 yellow shelled corn trended 6 to 9 cents higher when compared to last report. Prices ranged $7.72-$8.57 at feed mills and $7.67-8.07 at elevators. No. 1 yellow soybeans trended 8 cents lower and were $18.14 at processors, and $16.89-$16.94 at elevators. No. 2 red winter wheat trended 19 cents higher. Prices were $8.18 at the elevators. Soybean meal, f.o.b. at processing plants was $579.60 per ton for 48% protein.
 

Oil futures climbed to a four-month high Friday and briefly topped $100 a barrel in the wake of the Federal Reserve's latest plan to boost the U.S. economy through bond purchases. Light, sweet crude for October delivery settled 69 cents, or 0.7%, higher at $99 a barrel on the New York Mercantile Exchange, its highest finish since May 4. The contract briefly topped $100 a barrel in intraday trading. Brent crude on the ICE futures exchange settled 78 cents, or 0.7%, higher at $116.66 a barrel. Front-month October reformulated gasoline blendstock, or RBOB, settled 5.34 cents, or 1.8%, higher at $3.0156 a gallon. October heating oil settled 2.82 cents, or 0.9%, higher at $3.2395 a gallon.
 

Natural gas futures slumped Friday as forecasts for cool temperatures through the end of September suggested lower gas usage and increasing U.S. stockpiles ahead. Natural gas for October delivery settled 9.4 cents, or 3.1%, lower at $2.943 a million British thermal units on the New York Mercantile Exchange. Futures had traded as high as $3.062/MMBtu earlier in the session.
 

Gold futures eked out a new six-month high as optimism for demand remained strong in the wake of the Federal Reserve's newest monetary-easing initiative. The most actively traded contract, for December delivery, gained 60 cents to settle at $1,772.70 a troy ounce on the Comex division of the New York Mercantile Exchange. Unlike gold, silver pulled back Friday, settling down 0.4% at $34.656 a troy ounce.
 

The week ended strong on Wall Street, the Dow closing at 13593, up 53; Nasdaq jumped 28 points to close at 3183; and the S&P 500 rose 5 points to finish the week at 1465.