TFM Midday Update 9-14-2022

Provided by Stewart-Peterson Inc.

CORN

Dec corn down 8 @ 6.85
USDA’s corn carryout estimate for 22/23 at 1.219 bb is the lowest in 10 years
Today is last trading day for September grains
A potential railway strike could impact the movement of grains (as well as other goods) throughout the country
Tomorrow the market will get four weeks’ worth of export sales data
US corn is at a premium compared to Brazil, Argentina, and Ukraine

Nov soybeans down 10 @ 14.69
USDA’s soybean carryout estimate for 22/23 at 200 mb is the lowest in seven years
There is talk that the Biden administration may impose sanctions against China (due to a possible Taiwan invasion) – this would hurt US soybean export demand to China
Yesterday China purchased five cargoes of Argentina soybeans
China is doing all they can to limit raw material imports from the US (including soybeans) but November price on their Dalian exchange is around the equivalent of $20.68 per bushel

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Dec wheat down 1 @ 8.60, Dec KC up 8 @ 9.42, & Dec MNPLS up 7 @ 9.38
Chances of rain in the southern plains next week could help planting conditions
Russia is in the midst of talks with Turkey regarding the Ukraine export corridor deal (which expires in November)
The higher US Dollar offers resistance to the wheat market and a recession in the US could slow food demand
Wheat may remain in a trading range as the market waits for news regarding demand vs the possibility of the export corridor in Ukraine being shutdown

Oct LC down 0.100 @ 144.700 & Sep FC up 0.475 @ 179.925
The food component of the CPI data increased 11.4% which is the fastest rate of increase since 1979 (this food inflation may curb demand for beef)
The possibility of a railway strike this week could impede feed movement to feedlots
Slaughter pace remains strong and above a year ago
Choice cuts down 2.28 and select down 2.18
Cattle slaughter projected at 127K
CME Feeder Cattle Index for 9/13: down 0.85 @ 180.06

Oct hogs down 0.725 @ 95.025 & Oct pork cutout down 1.775 @ 103.000
The inflation numbers did not seem to impact hogs as they did cattle
Packers becoming more aggressive yesterday may signify that they have held back and now need to purchase hogs to maintain the slaughter pace
Without a higher trend in cutouts, upward futures price movement may be limited
National Direct Afternoon report increased 9.98
Hog slaughter projected at 479K
CME Lean Hog Index for 9/14: down 0.62 @ 97.67

Brandon Doherty