TFM Midday Update 10-11-2022

Provided by Stewart-Peterson Inc.

CORN

Dec corn down 4 @ 6.94
Corn is lower this morning ahead of tomorrow’s WASDE report, which is expected to show a decrease in ending stocks
Expectations for the report are a 13.89-billion-bushel crop, which would be the lowest in three years, and ending stocks somewhere below 1.20 bb, the lowest in ten years
Export sales have been poor with Brazilian corn being cheaper
Moving grain is an issue in the US with the Mississippi River barge traffic backed up due to low water levels and now the possibility of a rail strike again

Nov soybeans up 4 @ 13.78
Soybeans are higher despite expectations for tomorrow’s WASDE report to show a small increase in soybean ending stocks
Soybeans and meal are trading higher, while bean oil is lower thanks to another dip in crude oil
Domestic demand has remained bullish with crush margins of 3.04 incentivizing processors
China’s NGTC announced that it plans to auction 500,000 mt of imported soybeans from its state reserves as beans on the Dalian exchange are trading at the equivalent of $13.25

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Dec wheat down 30 @ 9.09, Dec KC down 26 @ 9.98, & Dec MNPLS down 22 @ 9.93
Wheat contracts are backing off from their big gains yesterday as some profit taking is likely taking place ahead of the WASDE report
Russia has ramped up their attacks on Ukraine for the second day in a row and continues to target major cities with missile attacks
The Black Sea grain deal looks more and more unlikely to be renewed as the war escalates
Tomorrow’s report is expected to be bullish for wheat as production has already been lowered

Oct LC up 0.950 @ 145.650 & Oct FC up 2.450 @ 174.550
Both live cattle and feeders are higher with feeders again leading the way with lower corn
Slaughter pace has been strong despite lower packer margins, but cheaper beef may spur demand
If there is a railway strike, grain prices could rise and pressure live cattle while giving a boost to feeders
Choice cuts down 1.44 and select down 2.31
Cattle slaughter projected at 127K
CME Feeder Cattle Index for 10/10: down 0.31 @ 174.61

Oct hogs down 0.775 @ 93.500 & Oct pork cutout up 0.700 @ 102.500
Front month hogs are lower while April and further are higher as cash slipped again and the cutout fell by 0.15
Cash is expected to follow the trend and be higher as packers step up to procure inventory
December futures are at a large discount to cash which may give futures room to run higher
National Direct Afternoon report fell 2.75
Hog slaughter projected at 487K
CME Lean Hog Index for 10/11: up 0.33 @ 92.98

Amanda Brill