TFM Sunrise Update 03-30-2022


Corn futures were higher overnight with nearby May corn up 7-1/2 cents at 7.33-3/4 and the new crop December contract up 4-1/2 cents at 6.57-1/4.  Early morning has the energy complex trading higher, while the equity markets are trading a lower.  The market is in a bit of a recovery mode following yesterday’s peace talks which lead the market to trade down to its daily limit at one point.  It appears that Ukraine is willing to remain a neutral territory but is unwilling to give up any of its territory and wants Russian troops out.  While Russia is eyeing Odessa ports.  Concerns remain regarding the logistics of Ukraine’s corn exports and farmers ability to completely plant their crops.  Weekly ethanol production and usage will be released later today.



The soybean complex traded higher overnight in a bit of a rebound from yesterday’s lower trade.  This morning may soybeans are trading 6-1/4 cents higher at 16.49-1/4 and the new crop November contract is trading 9 cents higher at 14.57-1/2.  The products are trading higher as well with May meal up $1.80 at $467.80 and May oil is trading up .46 cents at 72.12 cents per pound.  Peace talks between Russia and Ukraine yesterday lead the complex lower as the market liquidated some war premium, with month end and quarter end adding pressure to an already weakening technical picture.  Though concerns remain regarding Ukraine’s logistics as the country supplies the world with 50% of its sunflower oil supplies.

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Wheat futures traded both sides of unchanged overnight following yesterday’s lower trade.  As of this writing, May Chicago is down 3/4 of a cent at 10.13-1/2, May KC is up 1 cent at 10.25-1/2 and Minneapolis wheat is up 7-1/4 cents at 10.50-1/4.  The wheat futures, at one point traded down the daily limit yesterday on the bearish headline of peace talks between Russia and Ukraine which added to the negative technical picture and selling.  With month and quarter end, look for continued position squaring ahead of tomorrow’s USDA Stocks and Planting intentions report.  Forecasts continue to look for a drier than normal April for the US southern plains.


The cattle market is called to open mixed to higher.

Cattle futures saw modest to strong gains as a selloff in grain markets helped support the cattle market. The drop in grain prices supported strong triple digit gains in feeders, and that strength spilled into the live cattle market.  The cash market stayed quiet on Tuesday as bids were still undefined. Asking prices were at the $140-plus levels. Cash trade will likely start developing later in the week.  After a firm close in retail beef values on Monday, Tuesday closing trade was mixed, with Choice carcasses gaining .63 to 264.50 and select was 1.48 lower to 254.84. Load count was light at 87 midday loads.  Feeder cattle had the biggest impact of the grain markets with strong buying support. Technically, feeder cattle posted strong price action, opening the door for additional money flow, and buying support.  The grain trade will likely have some impact on the cattle markets this week, so expect some volatility as that market moves towards a key USDA report on Thursday, with grain stock and planting intentions numbers.  Cattle price are still range bound but with the strength on Tuesday, are challenging the top of those trading ranges.


The hog market is called to open mixed to lower.

Hog futures profit taking as cattle-hog spreads likely were in play, and profit taking before today’s USDA Quarterly Hogs and Pigs report. Expectations for that report are, All hogs as of March 1 at 99%, Kept for breeding at 99,9%, and Kept for marketing at 99%, compared to last year. In addition, the market will be keeping a close eye on farrowing intentions to gauge if the market has moved back into expansion, or at least stabilizing overall numbers. Pork values closed softer on Tuesday, but traded 3.47 lower to 103.94 on a load count of 305.76 loads. Cash markets have been turning softer. National Direct Trade at midday Tuesday, was 1.96 lower to 103.93, with the 5-day average at 106.22. The lean hog cash index was higher, gaining 0.68 to 102.93. The Apr contract has a premium of 3.120 over the index, which could be limiting on the front month with only three weeks of life left in the Apr contract. The market will be looking to the USDA report on Wednesday to set up the next direction. The path still wants to work higher, but validation of the supply picture will be a key.



Scott Masters

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