TFM Midday Update 12-16-2022

Provided by Stewart-Peterson Inc.

CORN

March corn down 2 @ 6.52
National corn basis remains the strongest in 20 years
Dryness continues in Argentina and southern Brazil
An estimated 9 mmt of corn is still in the fields in Ukraine
There is talk of a 1^st quarter soft recession due to higher interest rates, which may impact the demand for food and fuel
The Buenos Aires Grain Exchange said corn planting in Argentina is 43% complete with the crop rated 18% good to excellent

January soybeans up 4 @ 14.77
Soybean export commitments are up 4% from last year
China could see more of an increase in covid cases, which could lower their imports of raw materials
The Swiss national bank and the Bank of England also increased interest rates by 50 basis points in an effort to fight inflation
The Buenos Aires Grain Exchange said soybean planting in Argentina is 51% complete with the crop rated 19% good to excellent
November NOPA crush was 179.2 mb (vs 181.5 mb expected)

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March Chi wheat down 1 @ 7.56, March KC down 9 @ 8.52, & March MNPLS down 3 @ 9.16
US southern Plains may experience very cold temperatures and there is concern about winterkill
War is escalating again in Ukraine with more reports of heavy bombing last night
Russian exports may be delayed because of poor weather, slow inspections, and insurers no longer offering war risk for vessels
French wheat prices are almost equal to Russian prices and are at levels not seen since the war started
Argentina’s wheat crop is said to be 54% harvested

Feb LC up 0.100 @ 154.950 & Jan FC up 0.600 @ 183.650
Cash was steady to $1 higher
Slowing slaughter pace should improve margins but may not help futures if offset by tighter cattle numbers
Traders may still have concern about overall demand
Slaughter weights are declining which should help support prices even with reduced slaughter
Choice cuts up 4.23 and select up 1.82
Cattle slaughter projected at 120K
CME Feeder Cattle Index for 12/15: up 0.03 @ 179.50

Feb hogs up 2.750 @ 84.400 & Feb pork cutout up 2.000 @ 92.250
Hogs had triple digit losses yesterday in the face of higher cash, cutouts, and export sales
China was the number 2 buyer on yesterday’s export sales report
If cash and cutouts are higher today it could lead to a bounce in futures
February futures remain oversold technically
National Direct Afternoon report increased 0.81
Hog slaughter projected at 486K
CME Lean Hog Index for 12/16: up 0.20 @ 81.88

Brandon Doherty