By: NATHAN STUEDLE
GRAIN:
July corn closed down 7 cents and December corn was down 8 cents. July soybeans closed down 24 1/2 cents and November soybeans were down 25 3/4 cents. July KC wheat closed down 3 3/4 cents, July Chicago wheat was down 5 1/2 cents, July Minneapolis wheat was down 5 1/4 cents.
U.S. crop futures continued lower on Thursday with soybean futures hit particularly hard after another week went by with no labeled sales to China for the upcoming 2026-27 season. While not necessarily a reason for outright panic, the lukewarm demand currently combined with good growing conditions have traders committed to liquidating long positions. Outside markets also leaned bearish with energy futures lower following the U.S. House of Representatives voting on Wednesday to pass a measure to essentially put the ongoing war in the Middle East into Congress' hands. On the same developments, stocks were higher and Treasury yields lower. Despite optimism the worst of the fighting is past, there are few encouraging signs the Strait of Hormuz will reopen to commercial traffic any time soon. However, it has also been reported by the Wall Street Journal (and others) that Gulf countries are rapidly working to build pipeline systems to bypass the waterway completely and bolster oil trade flows.
LIVESTOCK:
Who would have ever thought after hearing about the first positive case of New World screwworm being detected in the U.S. -- the first time in 60 years -- that the live cattle complex would trade substantially higher? I think this turn of events really needs to be a reflection point as to how the cattle complex operates, trades and digests information.
It appears in today's environment where digitalized/algorithmic trading has taken over much of the marketplace, the futures complex trades more so on headlines/rumors before knowing the actual facts. We've now seen this play out as clear as day with the NWS situation. It seems although traders pressured the market lower ahead of the actual finding, they now merely feel relieved that a confirmed case has been identified. And in last month's Cattle on Feed report where trades pushed the market sharply lower ahead of the report, assuming that placements would be sharply higher, but then when the data confirmed that, they pushed the market back higher. So let us all make a mental note of this trend and really understand that the futures complex is an anticipatory market that trades on any rumor or on any headline -- it doesn't sit around and wait for the facts. Or as the old saying goes, sell the rumor, buy the fact.
A note about New World screwworm: Last night, USDA confirmed a case of New World screwworm (NWS) was found in the umbilical area of a three-week-old calf in Zavala County, Texas. The under secretary for marketing and regulatory programs at USDA said, "USDA invested heavily in the tools needed to eliminate NWS ever since cases started increasing in Central America and Mexico. The United States has defeated this pest before, and we will do it again." USDA also said they will continue to work with state departments of agriculture, animal health officials, industry, and producers to mitigate economic impacts of restrictions as much as possible, limiting them to defined geographic areas. NWS does not infest meat, fruits, vegetables or other food sources -- the U.S. food supply is safe.
Upon seeing the live cattle contracts shoot higher, the feeder cattle contracts wasted no time in doing so as well as most of the contracts are traded more than $10.00 higher. Aside from wanting to remain in alignment with the live cattle complex, the feeder cattle market may also be trading higher as the finding of NWS in the U.S. likely means the border will remain closed for the distant future.
Even though midday pork cutout values were higher, the lean hog complex's momentum seemed to stall out as the cattle contracts rocket-launched higher. At this point, Thursday's movement simply appears to be a combination of pullback from the market's resistance and a decrease of trader support as the market's immediate attention sits with the cattle contracts.