TFM Midday Update 01-26-2021

CORN

Mar up 16 @ 5.28 & Dec up 9 @ 4.44
Argentina, conditions will stay favorable for crops – some of the south will be too dry
CME raises margin requirements for futures to $1,400
USDA sees Argentina corn crop at 47.0 mln tonnes – 500K tons lower than USDA report
Export demand & outlook for tighter ending stocks supports futures
Daily export sales of 1.360M mt of corn sold to China & 102K mt to unknown

Mar up 29 @ Nov up 19 @ 11.49
Brazil, conditions will be good for most key production areas
CME raises margin requirements for futures to $3,000
Funds are buying again after liquidation last week
Rains are slowing Brazilian harvest – only at 1% versus 4% this time last year
EU continues Covid lockdown – could last until summer
Demand expected to stay strong – China rumored to be buying this week – no confirmation yet

Mar up 17 @ 6.65, KC Mar up 16 @ 6.43, & Mar MNPLS up 14 @ 6.48
Japan seeks 60,715 tonnes of wheat from Australia
US Plains wheat ratings decline in Kansas, Colorado, Nebraska & S. Dakota
Shipments of Australian wheat to China surge after months of tensions & no trade
Argentine wheat exports projected at 11.3 mt – 700K tons less than USDA report
Russian government approved 50 Euro wheat export tax starting March 1

Feb LC up 0.40 @ 116.92 & Mar FC down 1.50 @ 142.35
Cold Storage report: red meat supplies in freezers were up 1% from last month & lbs of beef in freezers were up 4% from last month
Rally in corn and concerns over production costs pressure FC markets
January feeder cattle last trading day, Thursday 1/28
Today’s slaughter est. at 116K head
Cash trade delayed due storms LC & @ 134.48, up 0.49 for 1/22 for FC cash index
O/I: -2059 contracts for Feb LC & O/I: -102 contracts for Jan FC

Feb Hogs down 0.30 @ 70.32 & Feb Pork Cutout up 0.32 @ 83.20
Cold storage report: Frozen pork supplies down 3% from last month & stocks of pork bellies were up 32% from last month
Limited upside if China demand continues to slip
Hog slaughter estimated at 476K head
Cash lean index @ 65.88 up 0.33 @ 1/22
O/I: -1865 positions for hogs & pork cutout futures -8 positions

Amberlee Bratcher