TFM Midday Update 12-14-2022

Provided by Stewart-Peterson Inc.

CORN

March corn down 3 @ 6.50
The Odessa (Ukraine) port is partially back working but there is concern about getting insurance for the vessels
An estimated 40% of Ukraine’s corn crop is not yet harvested and up to 9 mmt might remain in the fields until spring
November CPI data came in at 7.1% vs an expected 7.3%
US corn exports are still struggling with cheaper offers from both Brazil and Ukraine
Expectations are for the Fed to issue a 50 basis point increase to interest rates this afternoon

January soybeans up 2 @ 14.82
The IEA raised 2022 and 2023 global oil demand
More China covid cases raise concern about their demand for raw materials
Argentina’s soybean crop is 37% planted (vs 56% last year)
The Brazilian state of Parana’s ag agency estimates their soybean crop at 20.8 mmt (up 70% from last year when it was reduced by drought)
China may be 70-75% covered for Jan-Feb; in February, Brazil’s soy offers are at a discount to the US

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March Chi wheat down 7 @ 7.44, March KC down 20 @ 8.45, & March MNPLS down 9 @ 9.14
India’s wheat stocks are 19 mmt which is the lowest in 6 years
Russia is estimating their 23/34 wheat crop at 80-85 mmt (down from 91 mmt this year)
A winter storm with cold temperatures in the plains is a concern for the HRW crop
Russia remains the world’s cheapest wheat offer
The US Dollar hit a 6 month low yesterday

Feb LC down 0.300 @ 156.050 & Jan FC up 0.025 @ 184.250
Live cattle futures hit new contract highs yesterday (excluding Dec and Feb)
Packers have reduced slaughter needs through the end of the year and may be less aggressive
Feedlots may still hold out for higher cash since Packers do not have many cattle purchased ahead (despite the fact that they may be less aggressive)
Choice cuts down 2.07 and select down 0.22
Cattle slaughter projected at 127K
CME Feeder Cattle Index for 12/13: up 0.03 @ 179.97

Feb hogs down 0.300 @ 84.275 & Feb pork cutout up 0.100 @ 93.175
December hogs expire today with February taking over as front month
Packers may ease slaughter pace into the end of the year
Recent pork export sales have been unsupportive and the slow international demand could backup supply
February hogs are technically oversold and could be due for a bounce
National Direct Afternoon report declined 0.20
Hog slaughter projected at 491K
CME Lean Hog Index for 12/14: up 0.15 @ 81.62

Brandon Doherty