Wheat futures lower; feeder cattle limit down

Market Line June 3, 2009 Wheat futures posted modest losses Tuesday after closing well off the day’s lows thanks to a continued lower dollar. After Monday’s big run up profit taking was a feature. Market bears are saying this has been a short covering rally and if outside markets don’t remain supportive there could be a big correction.

Louise Gartner for the Linn Group at the Chicago Board of Trade notes wheat has been rallying way past the normal seasonal window of early May but funds are probably still not net long wheat. As for production issues;

Gartner: “Canada also looking at a serious situation developing in the western plains where it has been very, very dry. They need rain right away or they are going to start seeing significant yield declines. Further east just above North Dakota into Manitoba they are still too wet having the same kind of planting delays that we have seen in much of North Dakota.”

On Tuesday Chicago July wheat was down a nickel at 6-69 ½. July corn up 3 ¾ at 4-49 ½. Portland soft white wheat and club wheat steady to a nickel lower at mostly 6-30 with some club bids to 7-30. August new crop soft white steady to a nickel lower at mostly 6-30. HRW 11.5 % protein down seven cents at 7-49. DNS 14% protein down two cents at 8-78. No Portland barley bids.

Live cattle futures were sharply lower Tuesday with feeder contracts down the limit. Limit losses in hogs spilled over to cattle. Cattle trader are concerned about beef demand. Lower live contracts and the recent run up in corn futures pressured feeders as did a weak cash market. August live cattle down a dollar at 80-65. August feeders down $3 at 97-17. July Class III milk down 12 cents at 11-10.

I’m Bob Hoff and that’s Market Line on the Northwest Ag Information Network.

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