TFM Midday Update 04-18-2023

CORN

May corn down 3 @ 6.73
The USDA said 8% of the corn crop is planted vs 5% average.
The Fed will likely raise interest rates again in May, as long as inflation remains above the 2% target.
If the Ukraine export corridor closes, China may be forced to buy corn from the US.
The colder and wetter forecast for much of the midwest should slow fieldwork.
Brazil’s corn growing region received some rain, but the trend is expected to be drier in May.

May soybeans down 4 @ 15.13
The USDA said 4% of the soybean crop is planted vs 1% average.
China’s first quarter GDP was up more than expected – this raised the May soybean price on their Dalian exchange by 3.3% (to around the equivalent of $17.01 per bushel).
The US ag attaché in Buenos Aires lowered their estimate of Argentina’s soybean production to 23.9 mmt.
Part of the strength in soybeans yesterday may have been due to March crush data coming out higher than expected.

May Chi wheat down 6 @ 6.91, May KC down 13 @ 8.77, & May MNPLS down 11 @ 8.78
The USDA kept winter wheat condition unchanged from last week at 27% good to excellent (this is a 34 year low).
The USDA said 3% of the spring wheat crop is planted vs 7% average.
Poland, Hungary, and Slovakia have reportedly banned food imports from Ukraine, in an effort to help their farmers retain profitability.
Paris milling wheat futures are higher for the third consecutive day.
Frost in the southern plains could be an issue, with more cold temperatures in the forecast.

Jun LC down 0.150 @ 164.725 & May FC down 0.050 @ 210.700
The cattle complex has bullish momentum on solid fundamentals.
Feedlots may hold out for higher cash again as they know packers need to purchase cattle.
Feeder cattle futures were higher yesterday, despite higher corn futures.
Futures are technically overbought, which could limit upside potential.
Boxed beef prices are strong and continue to trend higher.
Choice cuts up 3.36 and select up 5.45.
Cattle slaughter projected at 126K
CME Feeder Cattle Index for 4/17: up 4.33 @ 205.64

May hogs down 1.400 @ 79.600 & May pork cutout down 1.375 @ 85.000
May futures are now the front month contract, and hold a nearly $10 premium to the index.
Stronger fundamentals may be needed for futures to rally.
Funds are holding a record short position.
Strong slaughter pace may eventually tighten supplies.
National Direct Afternoon report declined 0.33.
Hog slaughter projected at 482K
CME Lean Hog Index for 4/18: down 0.11 @ 71.52

Brandon Doherty