Grains and Oilseeds: July corn closed at $6.61 ½ per bushel, down 1/2c as better weather is forecast for the growing areas. The recent rally from the $6.10 area prompted by planting delays. We like corn but raise trailing stops. July wheat closed at $7.22 per bushel, down 6 1/2c after recent tours did not find any meaningful crop damage and the "freeze" has now passed. We prefer the sidelines in wheat. July soybeans closed at $13.87 ¼ per bushel, up 15c tied to tight cash markets. Also speculation that U.S. growers will not move acreage to soybeans from corn prompted shortcovering. We have favored beans in this group and continue to do so but raise trailing sell stops.
Meats: June cattle closed at $1.21925 per pound, down 172.5 points on long liquidation and on a technical correction in front of the weekend after recent strength. We could see renewed buying interest early in the week as demand improves for U.S. beef and weather could promote "barbecue" demand. We like cattle from here. June hogs closed at 92.325c per pound, down 50 points tied to weak cash market demand. We prefer the sidelines in hogs.
Coffee, Cocoa and Sugar: July coffee closed at $1.4015 per pound, up 70 points on reports that Brazilian producers are holding back shipping on speculation that the government would raise the minimum price for beans. We could finally see continued momentum build after the extended period of long liquidation. The Brazilian Governments price supports could prompt new buying. We like coffee from here but use stop protection. July cocoa closed at $2,412 per tonne, down $2.00 on profittaking after its recent gains from mid March’s lows around $2,100. Buying generated by the completion of the West African harvest and expectations pointing to sharply lower production for next year. We like cocoa from here but use stops. July sugar closed at 17.58c per pound, down 2 ticks. Expectations for Brazils cane harvest to accelerate with favorable weather and could produce a record crop. The rally on Thursday was prompted by reports that the three major sugar houses, Bunge, Wilmar, and Cargill took delivery of a record 1.4million tonnes of sugar. Strong demand from Asia and Middle East prompted the record delivery. We could see renewed speculative interest in sugar.
Cotton: July cotton closed at 86.18c per pound, up a half cent on shortcovering after the International Cotton Advisory Committee raised their price expectations even though they estimated higher global inventories. We prefer the sidelines in cotton.