TFM Midday Update 05-17-2022

CORN

Jul corn down 9 @ 8.01
The USDA reported that 49% of the corn crop is now planted, a big jump from last week, but still the slowest pace since 2019
14% of the corn crop has emerged, down from the five-year average of 32%
North Dakota and northern Minnesota can expect more rain on Thursday, while most of the Corn Belt will be warm, and Brazil having very little rain in the seven-day forecast
China’s corn price has been steady throughout their COVID concerns and they remain a good candidate for more US purchases

Jul soybeans up 11 @ 16.67
According to the USDA’s NASS, soybean crush pace for 21/22 is 1% above last year, so continued higher production puts the pace above the USDA’s estimate of a 5% decline
With incentives to crush still high and projections above USDA estimates, the 21/22 ending stock number of 235 mb is probably too high
China may ease COVID restrictions this week, which should boost demand
Argentina’s bean crop is over 2/3 harvested, but with dry conditions only 10% of the crop has earned a good to excellent rating

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Jul wheat up 15 @ 12.62, Jul KC up 10 @ 13.62, & Jul MNPLS up 9 @ 13.94
Wheat is recovering this morning after a big sell-off in the overnight, partially because India came back out and said that they are relaxing their wheat ban
The USDA has reported that only 27% of the winter wheat crop is rated good to excellent, the lowest since 1989
The USDA said 5% of spring wheat has been planted in Minnesota and 17% in North Dakota, two big producing states that are at risk for prevent plant in 2022
The wheat trends remain higher with weather troubles in both the North and South, and continued issues out of Ukraine

Jun LC up 0.225 @ 133.400 & May FC down 0.275 @ 157.125
Live cattle were buoyed yesterday from higher corn and wheat yesterday, in addition to the large discount to the cash market
Feeder cattle were dragged lower with higher grains, despite the tight supply of feeders available outside feed yards
August feeders fell to contract lows before rebounding, limiting losses there
The Commitment of Traders showed the funds selling 8,948 live cattle contracts, lowering their net long position to 29,949 contracts
Choice cuts up 1.36 and select up 1.77
Cattle slaughter projected at 125K
CME Feeder Cattle Index for 5/16: down 0.36 @ 156.00

Jul hogs up 1.875 @ 106.700 & Jun pork cutout up 0.350 @ 109.950
Hog futures hit the ground running, gapping higher on the open and closing with triple digit gains yesterday
Traders have been short-covering and establishing new long positions with the cutout strengthening and demand picking up
The Commitment of Traders showed funds selling 8,934 contracts, lowering their new long position to 20,608 contracts
National Direct Afternoon report has cash up 0.17
Hog slaughter projected at 478K
CME Lean Hog Index for 5/17: down 0.42 @ 100.07

Amanda Brill