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Farm markets retreat

Updated: 06/09/2011 @ 10:58am

CHICAGO, Illinois (Agriculture.com)--After starting sharply higher, with July corn futures setting a new high record, the CME Group grain and soybean markets have given back the sharp gains Thursday. 

Initially, the grain and soybean markets responded friendly to the bullish USDA June Supply/Demand Reports Thursday.

At mid-session, the July corn futures are trading 21 1/4 cents higher at $7.85 1/4, Dec. corn opened 19 1/4 cents higher at $7.13. The July soybean contract is 3 1/2 cents lower at $13.97. The July wheat futures contract is trading unchanged at $7.48. The July soybean meal futures contract is trading $0.70 per short ton higher at $373.50. July soyoil is $0.29 lower at $57.65.

In the outside markets, the NYMEX crude oil is $1.49 per barrel higher, the dollar is higher and the Dow Jones Industrials are up 128 points.

Joe Bedore, FC Stone Inc.'s CME Group floor manager, says the market overdid it to the upside on the open. "It's like any typical report day where brokers have to fill their orders. The market is bid up to a level the brokers can comfortably fill those orders. After that, the selling came through the pit, realizing the market prices were a little out of whack. The big thing that happened was the spread trading kicked in. Once the spread prices started deteriorating, the traders started hitting the July contract which brought the Dec. contract price down with it." 

The spot contract set a new all-time high record of $7.91 1/4. That doesn't tell us anything yet, Bedore says. "However, if we hold these prices, the close could tell us something. We could have some buying set in and then we are going to be off to the races, in the weeks to come," Bedore says.

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