CORN
Corn futures traded 3 to 4 cents lower overnight to 5.50 (May) and 4.66 (Dec). Trade estimates for this morning’s USDA Weekly Export Sales for old crop is 3.80 to 4.70 mil tons. Looking ahead to next week’s March 31 USDA report, the trade is looking for higher U.S. 2021 US corn acres increasing supply. This is providing overhead resistance to new crop Dec. Earlier this week, Informa estimated corn acres near 94.3 versus 90.8 last year. A Farm Futures magazine survey of U.S. planting intentions indicated that producers expect to plant 93.596 million acres of corn in 2021, up 3.1% from the 90.8 million acres seeded a year ago. A previous Farm Futures survey, released on Feb. 5, had projected U.S. 2021 corn plantings at 94.7 mil acres and 2021 soybean plantings at 84.5 mil. For stored crop inventory, strong U.S. domestic corn basis suggests that US may be overusing the 2020 corn supplies. As planting season approaches, U.S. growers will be less willing to sell any remaining inventories.
SOYBEANS
Soybeans were down 7 to 8 cents overnight to 14.25-3/4 in the nearby May contract. Nov was down a nickel to 12.23-1/4. Meal and soyoil were also weaker. Trade estimates for this morning’s USDA Weekly Export Sales for old crop beans is 100,000 to 450,000 tons. Soybean meal sales are estimated 100,000 to 300,000 tons; and, soyoil sales are 5,000 to 30,000 tons. A wire story reports China is taking in record amounts of soybeans from the U.S. and Brazil as its hog population recovers from a deadly disease that began nearly three years ago, but import expansion into the next marketing year might be minimal. Additionally, China continues to report new outbreaks of African swine fever (ASF). Higher nearby futures versus new crop reflects an outlook for a bullish upcoming USDA March 1 stocks estimate next week and bearish USDA 2021 acreage guess. March 1 stocks are estimated to be near 1.50 bil bu. The futures’ inverse could also reflect that U.S. farmers may have sold most of their 2020 supplies and while U.S. soybean exports may be slowing, though crush continues at a strong pace. Farm Futures magazine published their latest acreage estimates pointing to soybean plantings at 88.510 mil acres, up 6.5% from the USDA’s 2020 estimate of 83.1 million acres.
WHEAT
Wheat futures were weaker overnight led by Chicago contracts as the dollar makes new highs for the move. May lost 6 cents to 6.18-3/4. May KC was down 3 2 to 5.74-1/4. May Mpls spring wheat followed suit, shedding 1 to 2 cents to 6.25-1/2. Recent rains across the U.S. south plains has improved the U.S. 2021 HRW crop outlook. NOAA upgraded the America weather model. Tuesday’s model held a very cold weather pattern for much of U.S. SRW crop late next week. Yesterday’s map was not as cold. A Farm Futures magazine survey published winter wheat seedings estimated at 31.999 mil acres, up 5.2% year-on-year and close to the USDA’s Jan. 12 estimate of 31.991 million. Uncertainty over Russia 2021 crop and export policy could underpin futures. Trade estimates for this morning’s USDA Weekly Export Sales are 150,000 to 500,000 tons for 2020-21 wheat, 50,000 to 200,000 tons for 2021-22 marketing-year crop. Overnight tenders were as follows: Ethiopia seeks 400,000 tons of optional-origin wheat. South Korea seeks 130,000 tons of optional-origin feed wheat, Philippines passed on 155,000 tons of optional-origin milling, feed wheat, and bought 66,000 tons of optional-origin feed wheat.
CATTLE
Cattle calls are steady to higher. Cash markets began to develop yesterday with the Fed Cattle Exchange seeing bids from $114.25-$116, and trade occurring higher than last week at $115 and $116. This led to a bump in the countryside cash with a large amount of sales at the $115 levels, $1 higher than last week. The stronger cash helped support the futures, but the premium of April to the cash is still a limiting factor holding the front end in check. Choice carcasses gained .85 to 234.84, but Select was 1.16 softer to 224.07. Moderate load count was at 126 loads. Choice carcasses have been trending higher over the last week, helping provide the strength in the cash. Estimated slaughter yesterday was 121,000 head, 7,000 more than last week, but 4,000 under last year. Feeders saw good strength on technical buying, supported by the stronger deferred live cattle market. March feeders expire today.
HOGS
Hog futures are called steady to higher. The uptrend remains intact, and the fundamentals are back in play supporting the market, providing strength, however, the market may be choppy, squaring up positions before that this afternoons USDA Quarterly Hogs and Pigs Report. Expectations are for: All hogs and pigs estimated at 100.1%; Kept for breeding at 98.7% and Kept for marketing at 100.2%. The front end fundamentals stay supportive as the cash market stays strong. Weekly export sales this morning could help set the tone for the day. Cash prices are trading at their highest levels since October 2014, and the Lean Hog Index gained .76 to 93.47 while also trading at its highest point since 2014. Carcass values maintained their strength, gaining 4.69 to 110.47 at the close with moderate movement on 254 loads. The strong retail close should support prices on the open today.
Author
Matthew Strelow