TFM Midday Update 12-6-2022

Provided by Stewart-Peterson Inc.

CORN

March corn up 2 @ 6.42
Weekly corn inspections totaled 20.6 mb with total 22/23 inspections at 250 mb
Global demand remains a concern, but the national corn basis remains the strongest in 20 years
Friday’s USDA report is not expected to make any major changes but the USDA could lower our export numbers and raise our carryout
The corn market may be concerned about slower ethanol demand down the road
Yesterday March corn filled the gap from August (at 6.38)
Argentina’s corn crop may be lowered by 1.5 mmt on Friday’s USDA report because of drought

January soybeans up 31 @ 14.69
Weekly soybean inspections totaled 63.3 mb with total 22/23 inspections at 778 mb
Private exporters reported sales of 264,000 mt of soybeans for delivery to China and 240,000 mt to unknown (for delivery during the 22/23 marketing year)
China is relaxing some covid rules, which may be helping the bounce in soybeans
Argentina’s weather continues to be mostly dry but if La Nina weakens in January it could bring more rain
Soybean meal is sharply higher at midday

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March Chi wheat UNCH @ 7.39, March KC down 5 @ 8.37, & March MNPLS down 4 @ 8.98
Weekly wheat inspections 12.3 mb with total 22/23 inspections at 401 mb
ABARES (the Australian crop agency) raised the estimate of their wheat crop to 36.6 mmt (compared to the USDA at 34.5 mmt)
If the Ukraine war continues into spring, there is talk that their planted acres could be down by 50%
Wheat prices have been falling, despite tight supplies in both the US and abroad
Recent weakness in the Russian Ruble has made their wheat the cheapest world offer

Feb LC down 1.425 @ 154.400 & Jan FC down 2.850 @ 180.925
Live cattle did not find much support yesterday and are down sharply at midday
Packers may reduce slaughter pace but tightening supplies should still provide support
Packers may not be aggressive this week with the weakness of boxed beef
Choice cuts down 6.62 and select down 3.45
Cattle slaughter projected at 128K
CME Feeder Cattle Index for 12/5: down 0.89 @ 178.14

Feb hogs down 1.825 @ 88.700 & Feb pork cutout down 1.225 @ 97.075
Lower cutouts were unsupportive
Hogs have made a nice recover from the losses last month, but may remain sideways for now
Pork demand is expected to improve
Lighter hog weights should keep slaughter pace strong
National Direct Afternoon report declined 0.53
Hog slaughter projected at 491K
CME Lean Hog Index for 12/6: down 0.08 @ 82.79

Brandon Doherty