TFM Midday Update 8-26-2022

Provided by Stewart-Peterson Inc.

CORN

  • Sep corn up 12 @ 6.70
  • The Fed Chairman Powell’s speech this morning may impact financial and commodity markets
  • Ukraine has been mostly shipping corn to this point, and the corridor deal expires in October
  • China’s corn crop should not be affected much by the drought conditions in southern regions
  • January corn on China’s Dalian exchange is around the equivalent of $10.17 per bushel

SOYBEANS

  • Sep soybeans up 31 @ 15.84
  • Private exporters reported sales of 146,000 mt of soybeans for delivery to unknown during the 22/23 marketing year
  • The market is still concerned about overall demand (especially to China) and talk about a record 2023 bean crop in Brazil at 153 mmt
  • US soybean crush margins remain high, incentivizing processors
  • November soybeans on China’s Dalian Exchange are around the equivalent of $20.13 per bushel

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WHEAT

  • Sep wheat up 17 @ 7.87, Sep KC up 16 @ 8.85, & Sep MNPLS up 7 @ 8.90
  • US southern plains have seen some rains which should help conditions there
  • China’s rice and wheat crops are potentially in dire straits with extreme drought affecting those growing regions
  • The Zaporizhzhia nuclear power plant in Ukraine has been reconnected to the grid – it had been disconnected after fires broke out and there was concern of radiation leakage
  • Ukraine’s wheat harvest is reported to be 98% complete at 18.8 mmt (compared to 32 mmt last year)

CATTLE

  • Aug LC up 0.300 @ 141.400 & Sep FC down 2.000 @ 182.250
  • Cash was steady to $1 lower
  • Slaughter pace remains brisk as plants are trying to satisfy consumer demand
  • Overnight strength in corn may pressure feeders
  • Choice cuts up 0.71 and select down 0.08
  • Cattle slaughter projected at 124K
  • CME Feeder Cattle Index for 8/25: up 0.50 @ 181.00

HOGS

  • Oct hogs down 0.525 @ 90.575 & Oct pork cutout down 0.550 @ 101.275
  • Yesterday hogs rebounded from the lows but are fading again today
  • There is still a chart gap below the market on the Oct contract
  • Hog futures are oversold and due for a correction
  • National Direct Afternoon report declined 7.88
  • Hog slaughter projected at 451K
  • CME Lean Hog Index for 8/26: down 1.95 @ 116.05

Author

Brandon Doherty

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