TFM Midday Update 12-20-21

CORN

Mar corn down 4 @ 5.89
Omicron virus spread is causing lockdowns in Europe – if there are US lockdowns it could affect food and fuel demand
Stocks and crude oil are being pressured by the spread of the virus
US corn exports last week higher than expected, providing support to the corn market
About 40% of the growing regions in South America are warm and dry
Large speculative traders are net long 256,397 contracts according to the CFTC

Jan soybeans up 6 @ 12.91
Some analysts have raised US soybean carryout estimates due to exports
Malaysian palm oil is sharply lower overnight
Soybean oil is pressured by lower crude prices
According to the CFTC, managed funds bought 3,420 contracts of soybeans last week (now net long 16,920 contracts)
US soybean export sales are still 27% behind last year
2 week forecast for Argentina and southern Brazil is hot and dry

Mar wheat down 3 @ 7.72, Mar KC down 1 @ 8.09, Mar MNPLS down 8 @ 10.15
Canadian, Australian, and Russian production estimates have all been raised by the USDA
Paris milling wheat futures are under pressure
Russia’s wheat export tax this week will likely hit $94 per metric ton
Russia has decided to lower its upcoming wheat export quota to 8 mmt (vs 9mmt previously)
Argentina has limited corn and wheat export sales to curb their domestic food inflation

Feb LC down 0.425 @ 136.000 & Mar FC down 1.075 @ 160.625
Beef demand overall is not expected to be impacted much despite the spread of covid and the new omicron variant
Cattle futures may feel the pressure from weaker financial and outside markets today
Cash is anticipated to decline
Choice cuts up 0.04 and select up 0.14
Cattle slaughter projected at 121K
CME Feeder Cattle Index for 12/17: down 0.04 @ 161.04

Brandon Doherty