CORN
Corn futures were mostly unchanged overnight. Dec corn, at 5.70-1/2 is up 17-1/2 cents for the week. March corn is at 5.78-21/4 this morning. USDA, on Tuesday raised the corn crop in the most recent supply and demand report, but also raised ethanol, which offset the production increase. Based on the current La Nina pattern, the U.S. could have a dry spring and summer. Trade estimates for this morning’s delayed USDA Weekly Export Sales are 700,000 to 1.40 mil tons. Underlying support for corn stems from a higher wheat trade and inflationary concerns. European fertilizer producers have cut ammonia output by a quarter amid concerns that natural gas prices will remain high until mid-2022, CRU Group’s Head of Fertilizer Chris Lawson said in an interview. Corn prices in China have pushed to multi-month highs despite the advancing harvest after wet weather slowed crop collection just as record energy prices pushed up grain drying and logistics costs, analysts and traders said.
SOYBEANS
Soybean futures were firm overnight with Jan beans up 1-3/4 cents to 12.23-1/4. For the week, the contract is up 18 cents and trading within Tuesday’s 59-1/2 cent trading range between 12.40-3/4 and 11.81-1/4. The market is keeping an eye on soybean exports, which are currently running behind the USDA’s forecast. Trade estimates for this morning’s USDA Weekly Export Sales for beans are 950,000 to 1.80 mil tons. Meal sales are expected to come in between 100,000 to 250,000; and soyoil sales – zero to 15,000. The U.S. soybean crush likely rebounded in October from a three-month low the prior month as newly harvested beans bolstered crushing supplies, according to analysts polled ahead of a monthly (NOPA) report due on Monday. Harvest of the remaining 12-13% of the U.S. crop is being delayed by weather. South American weather conditions remain mostly favorable. Conab pegs Brazil’s soy crop up 3.4% year-over-year to 142.01 mil tons. Overnight, Chinese Ag futures (JAN 22) Soybeans were down 46 yuan ; Soymeal up 15; Soyoil up 32; Palm oil up 58; Corn down 31; M Malaysian palm oil prices were up 54 ringgit (+1.11%) at 4935 on concerns over tight supplies as heavy rains may delay harvesting of fresh fruit bunches in the world’s top growers.
WHEAT
Winter wheat futures are narrowly mixed this morning with March Chicago at 8.23 and up 43 cents for the week with yesterday’s new contract high etched at 8.36. March KC wheat is trading down slightly to 8.29 versus the new contract high of 8.42-1/4. For the week, the contract is up 46-1/2 cents. In Minneapolis, March spring wheat is up 4 cents to 10.50 and up 58-1/4 cents for the week. That contract’s high from Nov 2 stands at 10.66.1/4. Price strength is noted despite a strong dollar, but Russian wheat is still cheap compared to most regions. Trade estimates for this morning’s USDA Weekly Export Sales for beans are 200,000 to 500,000 tons. Elsewhere, more heavy rains are forecast in the near-term for eastern Australia wheat growing areas.
CATTLE
Cattle futures are called mixed in search of direction, as prices continue to consolidate in narrow trading ranges. The cattle markets’ technical picture is improved, but prices may be limited in the near-term by price resistance. Seasonal demand softness will be a concern as the market moves into and past the Thanksgiving Day holiday. February live cattle are still being held in check with resistance at $137 area, and failed to get through. A push through this level could open the market for a potential breakout higher. Cash trade saw renewed bids at $132, steady with trade from Wednesday. Asking prices stayed firm at $134. Light trade was noted Thursday, but additional clean up trade may be instore for today. The stronger cash tone so far this week, has failed to move the market higher. Retail values had a disappointing close on Wednesday, adding to the selling pressure. Thursday brought mixed retail values, with Choice carcasses slipping .38 to 285.14 but Select gained .67 to 267.29. The load count was light at 133 loads. The Choice/Select spread has begun to tighten, trading at 17.85 at the close, which may be reflecting a softening demand tone for the Choice beef product. Weekly export sales will be announced this morning, and could be a factor for the price close into the end of the week. Feeder cattle saw some buying strength, as grain markets worked off session highs. Some easing of the grain rally brought some light short covering in feeders. Front end November is holding a premium to the cash index, which traded .12 higher to 154.98, keeping pressure on the front end of the market.
HOGS
Hogs are called steady to higher. December hogs’ strong price recovery that started mid-week ran out of gas, as prices hit resistance at the 10-day moving average. The charts are still improved technically after the bullish “Hook” reversal posted in Wednesday’s trade, but further follow through will still be needed. Early session strength was attributed to talk of the Biden administration is considering a proposal that would allow for some processing plants to run faster chain speeds in order to increase available meat supplies. Retail values tried to provide support at midday, as pork carcasses were 6.46 higher and held most of those gains in to the close, gaining 5.23 to 95.80. The load count was moderate at 372 loads. Overall cash markets remain soft, but prices are back to historical levels, and that could build some support. National direct midday trade was not reported due to confidentiality, but the Cash Hog Index slipped losing .51 to 78.72. The index has built a slight premium to the December futures, trading 3.53 over the futures.
Author
Matthew Strelow