Surging soy prices sparked a broad crop-market advance Wednesday

The soy complex continued pulling crop prices higher Wednesday. The corn harvest may have been slightly delayed by the latest Corn Belt weather system, but there’s little doubt it’s advancing rapidly. Nevertheless, CBOT futures rose again today as talk of torrid soy demand sent that complex higher (and pulled the other crop markets upward in concert). December corn futures surged 10.75 cents to $3.7525/bushel in late Wednesday trading, while May added 10.25 to $3.97.

Palm oil news apparently encouraged soy market bulls. Soybean and product prices kept rising on signs of demand strength Tuesday night and moved even higher in response to supportive Malaysian and Indonesian palm oil developments. Palm output and stocks are apparently falling short of forecasts, thereby pushing prices out of their downtrend. The whole soy complex surged, with meal reacting to talk of rampant demand. Crude oil gains may have provided support as well. November soybean futures soared 35.0 cents to $10.43/bushel at their Wednesday settlement, while December soyoil spiked 1.39 cents to 34.18 cents/pound, and December soymeal leapt $22.1 to $397.2/ton.

The wheat markets also advanced. Bulls in the wheat pits may have reacted to talk that Black Sea wheat isn’t doing well and needs improved weather to prepare for winter and/or talk of Australian problems. But it was pretty clear that soy strength was spilling over into the wheat markets as well. December CBOT wheat gained 7.5 cents to $5.3825/bushel late Wednesday afternoon, while December KC wheat moved up 4.5 cents to $6.065/bushel, and December MWE wheat lifted 5.75 to $5.825.

Cattle futures couldn’t sustain their early-Wednesday bounce. Beef prices surged again today, which may have played a role in the rebound posted just after pit trading commenced this morning. However, bulls couldn’t sustain the move, thereby suggesting a lack of industry confidence about the late-2014 outlook. December live cattle futures ended Wednesday having fallen 1.02 cents to 166.75 cents/pound, while April futures slid 0.22 to 165.55. Meanwhile, November feeder cattle futures sank 0.60 cents to 233.05 cents/pound, and January feeders dropped 1.10 cents to 227.95.

Ongoing cash losses weighed on CME hogs. Although midday wholesale quotes recovered some of Tuesday’s big losses, the cash markets remained under pressure. Indeed, with the CME index expected to drop to 94.61 cents/pound Thursday, the breakdown has greatly reduced discounts built into nearby futures. December hog futures plunged 1.60 cents to 88.60 cents/pound at Wednesday’s close, while April hogs fell 0.45 to 89.10.