TFM Midday Update 2-3-21

CORN

March down 4 @ 5.39 & Dec down 3 @ 4.44
Brazil’s 2020 production forecast at 109 million tonnes – 6 million above last yr
Argentina’s 2020 production forecast at 46.5 million tonnes, 4.5 million less than last yr
Argentina crop weather remains favorably rated especially for a La Nina year
Mexico purchased 111,000 metric tons of corn on Tuesday
USDA estimates China’s corn usage will exceed production by 25 mmt
US corn is still the world’s cheapest feed grain all the way into late spring
Analysts project US corn exports will have to be raised by 250-400 mb as the corn export pace is record large

March up 3 @ 13.58 & Nov down 2 @ 11.49
Brazil’s production for 2020 forecast at 133 million tones, 5 million above last yr
Argentina’s 2020 production forecast at 48 million tonnes, 1.7 million less than last yr
Recent rains in South America improved crop potential there
Brazil’s harvest is lagging – 1.8 mmt soybeans shipped in January is reported to be the lowest since 2013
Despite delays, analysts think the total SA soybean harvest will be record large at 132-133 mmt

March down 15 @ 6.29, March KC down 12 @ 6.06, March MNPLS down 10 @ 6.11
Russia & Ukraine weather will be warmer than usual allowing for snow to melt
Russia has doubled its export tax beyond March 1^st
February is typically a time of seasonal weakness for wheat futures
Continued underlying support from expanding dryness in the western and southern plains hard red winter areas
Bitter cold moving down from the Canadian prairies through northern plains and Midwest could bring the threat of winterkill

Feb LC up .125 @ 116.100 & March FC up .550 @ 139.675
In position to at least experience a technical correction
Today’s slaughter est. at 118,000 head
Asking prices for southern fed cattle have been noted at $115 – about $2 higher than last week
Packers may resist by pointing towards the unseasonably heavy dressed weights noted so far this year
Demand has been strong, retail Choice carcasses trading at $236

February Hogs up .550 @ 72.100 & Feb Pork Cutout up .19 @ 82.57
Strong technical action seeing follow through buying this morning
Seems to be plenty of pork available if China imports slow
April lean hog futures broke through last week’s contract high at $77.60
Hog slaughter estimated at 496,000 head
Futures gains are generally supported by industry fundamentals (trending lower daily slaughter numbers and resilient export outlook)

Amberlee Bratcher