TFM Midday Update 06-22-2022

CORN

Jul corn up 9 @ 7.69
July corn is higher this morning, while deferred months are lower following a drop in good-to-excellent ratings to 70% from 72% last week
Weather forecasts show temperature moderation over the next seven days in central US, the Delta and southern Midwest are still expected to have extreme temperatures with little rain
The corn basis is at historically high levels with end users in the western Plains have said to have paid as much as 1.56 over July futures to secure supplies
Funds were liquidating long positions yesterday with open interest down by nearly 17,000 contracts

Jul soybeans down 10 @ 16.71
The soy complex is being driven lower again today, while crude oil is facing heavy selling, and palm oil fell another 9.8% yesterday as recession fears intensify
Soybean planting is 94% completed with 83% of the crop emerged, and a good-to-excellent rating of 68%, down from 70% last week
Ag Rural reported an increase in Brazil’s crop by 2.3 mmt to a record 126.8 mmt
Chinese imports have slowed down to 7.79 mmt for May from 9.23 mmt a year ago

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Jul wheat up 24 @ 10.00, Jul KC up 19 @ 10.60, & Jul MNPLS up 4 @ 11.21
Wheat is higher this morning following the news that Russia attacked a major grain terminal in Mykolayiv, Ukraine
Funds were liquidating long positions yesterday after rain was forecast this week across the Canadian Prairies, which is especially needed in Alberta and Saskatchewan
Spring wheat in Montana received a good-to-excellent rating of 25%, up 10% from the previous week, while the national average was 59%, up 5%
The USDA said that 25% of the winter wheat crop has been harvested, above the 5-year average pace of 22% for this time of year

Jun LC down 0.775 @ 137.050 & Aug FC down 1.175 @ 174.125
Live and feeder cattle are lower as the packer bids 137 in the South, which are being passed, with average asking prices around 142
Slaughter pace has been brisk, which keeps the packer buying cattle, as feedlots have higher show lists
Feeder cattle were higher on lower corn, but as corn begins to firm today, feeders have lost that support
Choice cuts up 1.06 and select up 0.31
Cattle slaughter projected at 126K
CME Feeder Cattle Index for 6/21: up 2.86 @ 165.03

Jul hogs down 0.600 @ 112.125 & Jul pork cutout down 0.900 @ 114.250
Hog futures are modestly lower after the cutouts lost 1.01, while cash is significantly higher after a day of aggressive purchasing by the packer
July put in the highest close since April 28, but slaughter pace is lagging with a revision to Monday’s slaughter being 18,000 head less than initially stated
The strengthening cutout should continue to provide support to the hog market as supplies are tight
National Direct Afternoon report has cash up 4.11
Hog slaughter projected at 473K
CME Lean Hog Index for 6/22: up 1.29 @ 110.45

Amanda Brill