TFM Midday Update 02-02-2023

CORN

Mar corn down 6 @ 6.75
USDA reported an increase of 62.7 mb of corn export sales for 22/23 and 6.4 mb for 23/24
The Fed issued a 0.25% interest rate increase yesterday afternoon and said more rate hikes are a possibility until they reach 2% inflation
After a firmer start, corn is trading lower at midday
April temperatures could play a key role in determining summer US weather
US Ag Attaché in Brazil expects their corn crop could be 8% larger than last year at 125.5 mmt
The EIA said US ethanol production increased by 1.5% last week to 1.028 million barrels per day

Mar soybeans up 5 @ 15.25
USDA reported an increase of 27 mb of soybean export sales for 22/23 and 7.1 mb for 23/24
US Energy Department reported higher inventories of crude, gasoline, and low sulfur distillates
Argentina’s crush rate to date is lower than what the USDA is forecasting
US Ag Attaché in Argentina is estimating their soybean crop at 36 mmt (down 9.5 from the USDA estimate)
Crop scouts in Brazil are projecting a record large 153 mmt soybean crop

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Mar Chi wheat down 7 @ 7.53, Mar KC down 10 @ 8.74, & Mar MNPLS down 5 @ 9.21
USDA reported an increase of 5 mb of wheat export sales for 22/23 and 1.2 mb for 23/24
The US continues to see icy storms in the southern part of the country
HRW areas are mostly dry but the American weather model shows up to 1.5 inches of rain next week in some of these areas (but the European model is in conflict with no rain)
US wheat export commitments are still down 6% from last year
The US Dollar Index hit a new near-term low today

Apr LC up 0.950 @ 163.175 & Mar FC up 2.450 @ 185.700
Beef net export sales of 25,200 mt for 2023
Weaker futures yesterday may have been the result of the report already being factored in, but both live and feeders are higher at midday today
Cash did not trade yesterday
Packers need cattle, which may result in higher cash soon
Concern over consumer demand, as boxed beef has been trending down
Choice cuts down 1.02 and select down 0.14
Cattle slaughter projected at 127K
CME Feeder Cattle Index for 2/1: down 0.05 @ 180.37

Apr hogs up 0.850 @ 74.825 & Apr pork cutout up 0.200 @ 92.200
Pork net export sales of 30,900 mt for 2023
Hogs traded lower yesterday on technical selling
Front month hogs may have finally found a bottom, trading over 1 dollar higher at midday
Feb hogs remain oversold but are also approaching expiration
Futures remain at a significant premium to the index which is a concern
National Direct Afternoon report increased 2.18
Hog slaughter projected at 490K
CME Lean Hog Index for 2/2: down 0.07 @ 72.51

Brandon Doherty