TFM Midday Update 01-30-2023

CORN

Mar corn down 1 @ 6.82
Ukraine’s Grain Association said that their corn production will not be over 18 mmt in 2023 because of the war
Private exporters reported sales of 112,000 mt of corn for delivery to Japan during the 22/23 marketing year
Argentina received more rain over the weekend which may help to stabilize the crop
Argentina corn is rated 12% good to excellent
The Fed is expected to issue another 25 basis point interest rate increase this week

Mar soybeans up 20 @ 15.29
March soybeans on China’s Dalian exchange are around the equivalent of $20.23 per bushel
China is back from their week-long holiday and may begin new purchases of energy, metals, and possibly soybeans
Soybean oil is being led higher by palm oil (which is at 3-week highs)
After the recent rains in Argentina, the country may return to a drier pattern over the next couple weeks
Argentina soybeans are rated 7% good to excellent

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Mar Chi wheat up 3 @ 7.53, Mar KC up 8 @ 8.77, & Mar MNPLS up 4 @ 9.26
Ukraine’s Grain Association said that their wheat production will not be over 16 mmt in 2023 because of the war
Last week March KC wheat posted a weekly bullish reversal and is trading higher this morning
Kansas and Nebraska are getting well below freezing temperatures, threatening the HRW crop with winterkill
As of January 24, funds were reported to be short 48,000 contracts of Chi wheat
Some reports suggest that Putin is preparing a new offensive as the war escalates in Ukraine

Feb LC up 1.600 @ 158.325 & Mar FC up 0.850 @ 184.325
Last week cash was steady in the north to $1 higher in the south
Feedlots may hold out for higher cash again this week as packers need cattle to keep up slaughter pace
Cattle inventory report will be released tomorrow with many anticipating a lower cow herd and lower calf crop
Boxed beef has been falling over the past couple weeks
Choice cuts down 0.99 and select down 0.94
Cattle slaughter projected at 125K
CME Feeder Cattle Index for 1/27: up 0.77 at 179.57

Feb hogs down 0.375 @ 75.500 & Feb pork cutout down 0.600 @ 83.075
Feb hog futures continue to show weakness as they remain at a premium to the index
Slaughter pace is higher than a year ago
Funds are net short 5,240 futures contracts after selling 14,130 contracts
February futures are still quite oversold
National Direct Afternoon report declined 0.30
Hog slaughter projected at 488K
CME Lean Hog Index for 1/30: up 0.12 @ 72.64

Brandon Doherty