TFM Midday Update 8-22-2022

Provided by Stewart-Peterson Inc.

CORN

Sep corn up 3 @ 6.29
Corn is trading quietly this morning and only down slightly as weather is neutral with better rains over the weekend and more moderate temperatures
China declared a national emergency over the drought, which is causing parts of the Yangtze River drying up, which may mean that more imports will be needed from the US
The ProFarmer crop tour begins today and will give an objective look to yields, with some analysts predicting final yields between 172 and 176 bpa rather than the USDA’s 177

Sep soybeans up 32 @ 15.20
Soybean futures and meal are higher today while bean oil is lower with falling crude, but as China deals with severe heat and drought they may be increasing US bean purchases
Crush values continue to be a bullish factor for beans with crush values at near a 3-dollar per bushel premium to January futures, and meal basis still strong in Illinois at 90 cents over futures
Friday’s CFTC report showed funds as sellers of beans last week reducing their net long position by 2,173 contracts to 99,336 contracts

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Sep wheat up 19 @ 7.72, Sep KC up 21 @ 8.65, & Sep MNPLS up 14 @ 8.89
Wheat futures are higher following reports that more Russian shelling took place near the Zaporizhzhia nuclear plant on Friday as well as agricultural targets in the Odesa region
Ships carrying grain have continued to leave Ukrainian ports without issue, but no wheat has been on board as cargo so far
Friday’s CFTC report showed funds as sellers again adding to their net short position by 2,241 contracts increasing it to 18,107 contracts

Aug LC down 0.400 @ 141.150 & Aug FC down 0.350 @ 181.150
Both live and feeder cattle are slightly lower after a seemingly bearish Cattle on Feed report with placements being higher than expected
While placements were much higher than trade expected, most placed cattle were under 600lbs, showing that light weights are being pushed into the lots early
There may be a supply issue down the road due to the large number of light cattle placed, and feeders are already hard to come by
Choice cuts down 0.11 and select up 0.47
Cattle slaughter projected at 124K
CME Feeder Cattle Index for 8/19: down 0.65 @ 179.21

Oct hogs up 1.175 @ 94.300 & Oct pork cutout up 1.000 @ 104.100
Hogs are higher this morning with lower cash and a drop in the cutout of 2.76, with the cutout having drifted lower throughout last week
Hog slaughter has been increasing as weights fall, signaling that the packers will need to purchase in larger numbers to make up for the tonnage
National Direct Afternoon report fell by 6.29
Hog slaughter projected at 474K
CME Lean Hog Index for 8/22: down 0.31 @ 120.29

Amanda Brill