TFM Sunrise Update 03-31-2022

CORN

The corn market traded both sides of unchanged in the overnight session, with the May contract trading 3/4 of a cent lower this morning at 7.37-1/4 while the Dec contract is 3-1/4 cents higher at 3.59-1/4.  In outside markets, equities and the US Dollar are higher, while crude oil and precious metals are lower.  The market rallied back yesterday as the fact that peace negotiators were not close to a cease fire between Russia and Ukraine once again.  This put the market on edge and brought back the concerns of whether Ukraine will be able to export current supplies and plant a full crop for the 2022 season.  Weekly corn export sales numbers will be released later this morning with estimates ranging from 600,000 to 1,100,000 metric tonnes for 2021-22, and 0 to 300,000 for 2022-23.  In addition to the weekly export sales numbers, the market is looking forward to the USDA’s Quarterly Stocks and Planting Intentions report which will be released at 11 a.m. CDT.  Estimates for today’s report have corn stocks at 7,885 mbu. versus 7,696 mbu. last year and acreage at 92 million versus 93.4 last year.  Once the numbers are released, expect the market to reset its focus on upcoming US weather and inflation concerns, along with crop production and export concerns surrounding the Black Sea region.

 

SOYBEANS

The soybean complex traded both sides of unchanged in the overnight session.  This morning, May and November soybeans are trading down 2 cents at 16.62-0 and 14.68-1/4 respectively.  As for the products, May meal is trading up 90 cents at $474.0 per ton and May soybean oil is down .81 cents at 71.41 cents/pound.  Futures rallied above Tuesday’s highs yesterday on word that China’s Sino Grain may purchase 3.5 mmt of soybeans from the US to replace supplies auctioned from State reserves.  A purchase of this magnitude could possibly drop US ending stocks from 285 mbu to 157 mbu. and allow for a retest of recent highs.  Weekly export sales numbers for soybeans will be released later this morning with estimates ranging from 400,000 to 1,400,000 metric tonnes for 2021-22, and 0 to 500,000 for 2022-23.  Estimates for today’s USDA Quarterly Stocks and Planting Intentions report have soybean stocks at 1,893 mbu. versus 1,562 mbu. last year and acreage at 88.8 million versus 87.2 million last year.  Once today’s report is behind us the market will continue to focus on upcoming US weather and inflation concerns, along with crop production and export concerns surrounding the Black Sea region.

 

Like what you’re reading?

Sign up for our other free daily TFM Market Updates and stay in the know!

WHEAT

The wheat complex traded both sides of unchanged in the overnight session.  As of this morning the May Chicago contract is up 4-3/4 cents at 10.32; May KC is up 3-1/4 cents at 10.47-3/4 and the Minneapolis May contract is up 9 cents at 10.67.  There have been reports of talk that the EU would grant subsidies to some North African countries to buy wheat and those countries in exchange would sell much needed oil to the EU.  Dry weather in the south plains has enabled the KC contracts to gain on Chicago, and much of those areas are expected to see continued dry weather with above normal temperatures.  Weekly wheat export sales estimates for this morning’s report range from 50,000 to 300,000 metric tonnes for 2021-22, and 150,000 to 500,000 for 2022-23.  Estimates for today’s USDA Quarterly Stocks and Planting Intentions report have wheat stocks at 1,064 mbu. versus 1,311 mbu. last year and acreage at 47.8 million versus 46.7 million last year.  Following today’s report, the market will continue to focus on crop production and export concerns in the Black Sea region, and US weather and inflation concerns.

 

CATTLE

Cattle is called to open mixed to higher.

Cattle futures saw mixed to lower trade as steady cash markets and a recovery in grain prices weighed on cattle markets.  The cash market stayed steady yesterday with most of the trade triggered at $138 in the south and northern trade at $221.00. this was fully steady with the majority of trade last week. Trade was light overall and will likely keep developing into the end of the week.  Closing beef retail values were higher with Choice carcasses gaining 2.04 to 266.54 and Select was 2.62 higher to 257.46. Load count was light at 85 loads. The firm retail close should help support the market on today’s open.  March feeders expire on Thursday and are trading in line with the Feeder cash index. The index gained .12 to 155.41, and March closed at 155.975.  Technically, cattle markets have improved chart actions, and the short-term trend is working higher. The grain trade will likely have some impact on the cattle markets this week, so expect some volatility as that market moves towards today’s key USDA report, 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 market will need some news and money flow to push prices to the upside.

HOGS

Hogs are called to open higher this morning.

Hog futures saw a second day of position squaring, and profit taking before the release of yesterday’s USDA Quarterly Hogs and Pigs report, which was released after the markets closed. The report saw most hog groups showing numbers below expectations. All Hogs as of March 1 were at 98% of last year vs. expectations of 99%, Animals kept for breeding at 98% of last year vs. expectations of 99.9% and kept for marketing at 98% of last year vs. expectations of 99%.  Besides light numbers overall, farrowing expectation were all below expectations, as the market was anticipating some growth in hog numbers. The impact of high input costs is likely weighing on producer’s thoughts of growing the hog breeding herds. The light numbers on the report will likely be very supportive of the market on the open.  Pork retail values softer on Wednesday, closing with small losses, trading .22 lower to 103.72 on a load count of 242 loads.  Cash markets have been turning softer. National Direct Trade at midday was unreported, but did firm at 104.91, with the 5-day average at 105.03 The lean hog cash index was higher, gaining 0.63 to 103.56. The Apr contract narrowed the premium to the index at .9650 over the index, which could be limiting on the front month with only two weeks of life left in the Apr contract.  A strong chance the buyers will return into the hog market given the light Quarterly hogs and pigs report. April could be limited given its time left in contract, but summer months and deferred will likely push to challenge the contract highs.

 

 

Author

Scott Masters

Sign up to get daily TFM Market Updates straight to your email!

back to TFM Market Updates