TFM Midday Update 02-03-2023

CORN

Mar corn down 1 @ 6.74
Corn is trading either side of unchanged today as improvements in Argentinian crop ratings pressure prices
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
The Fed issued a 0.25% interest rate increase and said more rate hikes are a possibility until they reach 2% inflation

Mar soybeans down 5 @ 15.30
Soybeans are lower as Argentina’s crop rating rose from 7% good to excellent to 12% thanks to recent rains
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 8 @ 7.53, Mar KC down 9 @ 8.72, & Mar MNPLS down 8 @ 9.17
Wheat is moving lower as chances for rain in the US plains increases over the next two weeks
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

Apr LC up 0.025 @ 163.850 & Mar FC up 0.275 @ 186.200
Live cattle are trading relatively unchanged as significant cash business is delayed due to another standoff between producers and packers, while feeders are higher
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 up 0.03 and select up 0.88
Cattle slaughter projected at 121K
CME Feeder Cattle Index for 2/2: up 0.53 @ 180.90

Apr hogs up 0.400 @ 86.400 & Apr pork cutout up 0.200 @ 93.350
Hogs are treading higher thanks to a boost in the cutout of 2.55 which has gotten traders excited
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 fell by 0.10
Hog slaughter projected at 486K
CME Lean Hog Index for 2/3: up 0.34 @ 72.85

Amanda Brill