Market Recap: Midwestern Rains Create Downward Spiral in Grains & Oilseeds

Lean hog futures were lower Tuesday as signs fo falling prices in cash markets more than offset previous signs of tight supplies.  August hog futures finished down 40 at 92.92, the October contract fell 82 to 78.27.

Live cattle futures fell in trading Tuesday succumbing to comparatively low cash parices and dubious signs for beef demand.  August live cattle closed unchanged at $118.

The selloff in corn futures provided a rare lift to feeder cattle futures, which have fallen steeply as spiking feed costs and spreading drought have raised production costs at feedyards just as a surge of stressed animals reaches markets.  August feeders gained 202 to $137.

Prices for corn and soybeans each fell Tuesday, as rains swept across the Midwest raising hopes that crop conditions could stablilize amid the country's worst drought in decades. 

While analyst warned that crops will still need more rain to develop healithily, the showers in northern regions of the farm belt on Tuesday rattled market participants who had bet that grain and soy prices would continue to rise.  The wet weather led them to sell futures to exit their bullish bets.  September corn fell 24 to $7.90, August soybean futures fell 49 1/4 to $16.49.

Wheat futures followed corn lower on Tuesday, as higher corn boosted demand for wheat as a boosted demand for wheat as a substitute in animal feed.  Wheat traders are waiting to see initital results from the harvest of spring wheat crops in the upper Midwest, which has begun early this year.  September wheat in Chicago ended down 34 at $8.78, September wheat in KC fell 33 1/2 to $8.80.

Cotton futures ended lower on a struger US dollar, weak outside markets and a surplus of the fiber as the 2011-12 season draws to a close.  Prices are falling with the "sheer panic" that hit commdities markets this week, acording to John Flanagan, president of Flanigan Trading.  December cotton dropped 116 to 71.03, and near month October fell 106 to 70.29.

Gold futures ended slightly lower after a day of indecisive trading, as afternoon gains in the dollar pressured some market participants to cash out of the precious metal.  August gold fell $1.20 to $1,576.20 an ounce, and August silver fell 20 cents to $26.77.

Crude oil futures settled modestly higher Tuesday, after  tumbling a day earlier on renewed worries of economic weakness in the euro zone.  September crude gained 36 cents to $88.50, August gasoline fell for a second straight day on Tuesday loosing more than 5 cents to $2.82 a gallon, the lowest level since July 13, August distillates gained a fraction to $2.82.

Natural gas futures rose to the  highest settlement in seven months on Tuesday, with forecasts of extreme heat supporting hopes that demand for gas powered electricity will stay strong.  August nat gas gained 7 cents to $3.18.

On Wall Street, stocks fell on Tuesday, hit by signs the euro zone crisis is worsening and by evidence that Europe's slowdown is hurting American companies.  The Dow fell 104 to close at 12,617. is dedicated to serving the agricultural industry in the Carolinas and Virginia with the latest ag news, exclusive regional weather station readings, and key crop market information. The website is a companion of the Southern Farm Network, provider of daily agricultural radio programming to the Carolinas since 1974. presents radio programs, interviews and news relevant to crop and livestock production and research throughout the mid-Atlantic agricultural community.