After the Bell | January 26, 2022
Corn: March corn futures rose 7 cents to $6.27, the contract’s highest close since $6.40 on May 7. December corn rose 3 cents to $5.72 3/4 and hit a contract high. Corn futures rose behind bullish technicals and crude oil’s rally to the highest prices since late 2014. U.S. ethanol production averaged 1.035 million barrels per day (bpd) the week ended Jan. 21, down 18,000 bpd from the previous week but up 11% from the same week last year. Ethanol stocks rose 884,000 barrels to 24.476 million barrels, the highest since May 2021, and Midwest supplies hit a record 10.107 million barrels. Tomorrow's weekly USDA export sales report is expected to show U.S. corn sales of 600,000 MT to 1.2 million MT in the 2021-22 marketing year and zero to 200,000 MT in the 2022-23 marketing year.
Soybeans: March soybean futures surged 32 3/4 cents to $14.40, the highest close in the contract’s lifetime. March soyoil climbed 142 points to 63.93 cents and March soymeal advanced $8.50 to $400.50. Soyoil helped lead the soy complex higher behind crude oil strength. Smaller soybean crops in South America likely will push export business to the U.S. starting in June, according to Oil World. The oilseed analyst estimates the combined 2021-22 soybean harvest in Brazil, Argentina, Paraguay and Uruguay will fall to about 186.3 MMT, down 7.4 MMT from the last season and a four-year low.
Wheat: March SRW wheat fell 23 cents to $7.95, March HRW futures fell 18 3/4 cents to $8.15 3/4 and March spring wheat fell 31 cents to $9.16 1/4. Winter wheat futures fell on profit-taking after sharp gains the previous two days. The market backdrop remained bullish as escalating Russia-Ukraine tensions pushed crude oil to seven-year highs. Russia is the world’s top wheat exporter and Ukraine is projected to be the fourth-largest in 2021-22, according to International Grains Council data. USDA is expected to report net weekly U.S. wheat sales of 200,000 to 600,000 MT. Net sales the week ended Jan. 13 were 380,600 MT for 2021-22, up 62% from the prior four-week average.
Cotton: March cotton futures rose 141 points to 122.33 cents per pound. Cotton futures rose for second day behind broader commodity and financial market strength and longer-term optimism over demand, meaning the market may take its next directional cue from tomorrow’s USDA export sales report. Last week, USDA reported net U.S. cotton sales for the week ended Jan. 13 at 273,000 running bales (RB), up 12% from the average for the previous four weeks. Also today, IHS Markit projected U.S. 2022 Upland cotton plantings at 11.702 million acres, down from a December estimate of 11.716 million acres.
Cattle: April live cattle rose $1.80 to $141.90. March feeder cattle rose 95 cents to $160.80. Cattle futures rose on short-covering following the market's slide early this week, with strength in U.S. stocks and crude oil contributing to the bullish backdrop. Live steers averaged just under $137.00 at mid-week, steady to weaker with last week’s trade. Most feedlots are seeking higher prices, but packers will likely be reluctant to raise bids. There is talk that cattle are backing up in feedlots, partly due to recent slowdown in packing plant operations due to Covid absences. Choice cutout values fell $2.92 today to $289.46 but movement was relatively strong at 132 loads.
Hogs: April lean hogs fell 80 cents to $96.45. February futures rose 57.5 cents to $88.025, the highest settlement for a nearby contract since Oct. 14. April hog futures fell for the first time in eight sessions in a corrective pullback from recent sharp gains. The most-active contract is still up over $13 during that span. Nearby futures’ steep premium to the CME lean hog index, currently $78.45, likely encouraged sellers, as did wholesale pork market weakness yesterday. The preliminary figure for tomorrow’s index is up 75 cents at $79.20, the highest since early November. Pork cutout values rose $2.14 today to $94.60, led by a jump of over $10 in hams. Movement totaled about 314 loads.
