April 23, 2008

Grains

Rice settled at a fresh all-time high, with the May contract closing 61 cents higher at $24.46 per hundredweight. Planting delays in the U.S. coupled with tight global supplies continue to send rice prices to new highs. As of this past Sunday, plantings were pegged at 26-percent complete; this nearly half of the average (43%) for this time of year.

Wheat fell to a 6-month low, with the July contract settling 34 1/2 cents lower at $8.31 1/2 a bushel. Speculation that U.S. crop conditions are improving, and news that Canadian farmers will increase fields sown with wheat by 16 percent, sent the market nearly 4-percent lower on the day.

News that Ukrainian Prime Minister Yulia Timoshenko lifted export restrictions sent ripples through the wheat markets. Ukraine is expected to harvest 40 million tons of wheat this year.

There is also speculation that Kazakhstan, which banned wheat exports until at least Sept. 1 to curb food inflation, will lift their ban. This news also added to the bearish sentiment in the wheat market.

July corn settled 6.25 cents higher at $6.015 a bushel, May soybeans settled 2 3/4 cents lower at $13.72 a bushel, July soy-meal settled $3.70 lower at $356.00 per short ton, and July soy-oil settled 26 points higher at 61.96 cents per pound.

Softs

Cocoa continued higher Tuesday, with the July contract settling $29 higher at $2,780 a metric ton. Unrest in Nigeria, the world's fifth-largest exporter, and strong global demand sent cocoa higher. Cocoa futures have gained over 25-percent over the past 2-weeks.

Orange juice settled 4-percent higher, with the July contract settling 455 points higher at $1.1955 a pound. Reports that some farmers are seeing citrus greening disease- a disease that kills trees and spreads to other trees- is adding some support to the market that is still trying to digest the huge crop report from Florida.

On the demand front, weak demand continues to weigh on orange juice prices. Last Wednesday, the USDA raised the Florida 2007-08 orange production estimate by 1.5 million 90-pound boxes to total 168.5 million boxes.

May coffee settled 10 points higher at $1.3540 a pound, July cotton settled 67 points lower at 74.08 cents a pound, and May sugar settled 24 points lower at 11.89 cents a pound.

Meats

Cattle futures settled higher, with April live cattle closing 87 points higher at 91.70 cents a pound. Rising cash prices amid stronger demand continues to push the cattle market higher. April feeder cattle settled 5 points higher at 101.75 cents a pound.

The U.S. Department of Agriculture's mid-day boxed-beef wire today reported choice cuts jumped .14 cents a pound and select items were .06 cents a pound higher.

Hog futures closed higher on the session with June lean hogs settling 175 points higher at 75.425 cents a pound and May pork bellies settled 40 points higher at 75.10 cents.

Metals

Gold encountered heavy selling today, with the June contract settling $16.20 lower at $909 an ounce. The U.S. dollar gained .7-percent today on expectations that the Federal Reserve is near the end of their rate cutting trend.

May silver settled 55 cents lower at $17.16 an ounce, July platinum settled $18.60 lower at $2,018.80 an ounce, June palladium settled $15.85 lower at $447.55 an ounce, and May copper settled 7 cents lower to end at $3.90 a pound.

Energy

Gasoline futures ruled trading in the energy complex, with the May RBOB gasoline settling 3.43 cents higher at $3.0507 a gallon. Gasoline inventories fell by 3.2 million barrels last week, about a million barrels more than expected, the EIA said. Shrinking supplies before summer driving demand continues to send prices higher.

Crude oil closed modestly higher, with the June contract settling 23 cents higher at $118.30 a barrel. Spill-over strength from rising gasoline prices sent crude higher. Crude inventories reported by the EIA came in at 2.4 million barrels. The market was expecting a gain of 1.5 million barrels.

May heating oil futures settled 0.81 cent higher at $3.325 a gallon, May natural gas settled 17.4 cents higher at $10.781 per 1,000 cubic feet.

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