TFM Midday Update 1-5-2022

CORN

Mar corn down 3 @ 6.07
The forecast for Argentina and southern Brazil remains dry for the next two weeks
Northern Brazil’s forecast remains very wet with expected totals of 5-12 inches in the next 10 days (delaying early harvest and causing quality concerns)
Some analysts are predicting a decline of 8-10 mmt in South America’s corn crop
There are rumors that China may buy 5-7 mmt of US corn

March soybeans up 5 @ 13.95
Some analysts are predicting a decline between 15-20 mmt in South America’s soybean crop
Barge basis along the Illinois river increased yesterday, suggesting there may be new soybean sales to China
March soybeans yesterday closed at their highest level since July
Palm oil again reached a new contract high due to flooding in Malaysia and Indonesia

Mar wheat down 7 @ 7.63, Mar KC down 13 @ 7.91, Mar MNPLS down 10 @ 9.61
Russia has likely shipped less wheat than what the USDA is estimating
Significant reductions in winter wheat crop ratings may help support the market
There are rumors that Iraq may have bought as much as 200,000 mt of HRW wheat but results from the tender are expected next week
Weather forecast for the US southern plains continues to remain dry for at least the next two weeks

Feb LC down 0.775 @ 137.050 & Mar FC down 0.725 @ 165.625
Both live and feeder cattle gapped lower on the charts yesterday
Yesterday may have been the first day in a liquidation phase (which can typically last 2-3 days)
Packers may be unwilling to bid up due to the pressure on futures as well as higher corn prices
Choice cuts up 0.79 and select up 0.33
Cattle slaughter projected at 117K
CME Feeder Cattle Index for 1/4: down 3.00 @ 162.35

Feb hogs up 0.900 @ 81.050 & Feb pork cutout up 0.525 @ 93.125
With the exception of February, hog futures resisted spillover pressure from cattle yesterday
Bullish potential due to trader concern over tightening supply
Higher cash is helping to support the market
National Direct Afternoon report increased 1.37
Hog slaughter projected at 474K
CME Lean Hog Index for 1/5: up 0.90 @ 72.75

Brandon Doherty