Market Snapshot | December 9, 2022

Corn futures are firmer and near highs for the week in narrow-range trading ahead of USDA’s monthly Supply & Demand Report, which is expected to show slightly higher corn ending stocks.
USDA’s U.S. corn stockpiles at the end of the 2022-23 marketing year are expected to be revised to 1.237 billion bu. from 1.182 billion bu. currently, based on a Reuters survey of analysts. Global ending stocks for 2022-23 are expected to be increased to 300.86 MMT from 300.76 MMT.
The report will also include updates on South American production, with analysts expecting a slight decrease in Argentina’s corn crop estimate to 53.54 MMT from 55.00 MMT, and an increase in Brazil’s crop to 126.45 MMT 126.00 MMT.
Turkish President Tayyip Erdogan said he will speak to Russia’s Vladimir Putin on Sunday, and he will also talk to Ukraine’s Volodymyr Zelenskyy in order to strengthen the Black Sea grain deal. “We want to strengthen the grain corridor and transport grain to less developed countries,” Erdogan said.
March corn reached $6.49 1/2, the highest intraday price in a week and up slightly from last week’s close at $6.46 1/4. A strong close today and followthrough buying early next week may bolster beliefs the market established a near-term bottom at a 3 1/2-month low of $6.35 posted Wednesday.

Soybeans are 1 to 2 cents lower, January soymeal is nearly $5 higher and January soyoil is down about 60 points.

Soybean futures faded after climbing to a fresh 2 1/2-month high overnight. Soymeal extended a sharp rally, while soyoil fell to 2 1/2-month lows.
USDA’s monthly Supply and Demand Report is expected to carry minor soybean adjustments. U.S. soybeans stocks at the end of the 2022-23 marketing year will be increased about 38 million bu., to 238 million bu., based on the Reuters survey.
USDA is expected to lower its forecast for Argentina’s soybean crop to about 48.7 MMT from 49.5 MMT in a November estimate, while raising its Brazil crop forecast to 152.58 MMT from 152.00 MMT.
Argentina rainfall is expected to remain restricted over the next two weeks, although there will be a short-term bout of needed rain falling in west-central through northern parts of the nation this weekend, World Weather Inc. said. “The rain will be welcome wherever it occurs, but not nearly enough to seriously improve the long-term outlook,” the forecaster said.
January soybeans edged 1/2 cent above Thursday’s high to hit $14.92 3/4, the contract’s highest intraday price $14.93 1/2 on Sept. 21, before fading. The contract is tracking for a sharp advance from $14.38 1/2 at the end of last week.
January soymeal touched $474.40, the further consecutive contract high, and is heading for a steep gain of about $48 for the week.

Wheat futures are lower, led by declines of 4 to 6 cents in HRW and SRW contracts.

Wheat futures are under continuing pressure from bearish technicals and weak export demand as traders await USDA numbers.
USDA’s Supply & Demand Report is expected to show a decline of about 2 million bu. in 2022-23 U.S. wheat ending stocks, to 576 million bu., based on the Reuters survey.
France’s ag ministry said 97% of the country’s wheat crop was rated good/excellent as of Dec. 5. Winter barley and durum wheat were rated 97% and 98% good/excellent, respectively. Regular rainfall and warm temperatures during fall aided sowing and early crop growth in France.
Russia’s wheat export tax for Dec. 14-20 will be 3,143.4 rubles ($50.28) per MT based on an indicative price of $313.40. That’s up from a rate of 2,806.8 rubles per MT the previous week and the highest rate since early September.
Egypt purchased 260,000 MT of Russian wheat via private deals.
March SRW wheat faded from overnight gains and is poised for its fifth straight weekly decline after ending last week at $7.61. Key support lies at $7.23 1/2, a 14-month low posted Tuesday.

Live cattle futures rose a second consecutive session amid corrective buying from sharp declines earlier this week and longer-term optimism over cash prices.
A two-month rally in cash prices appears to be leveling off. After light trade at steady levels earlier in the week, some cattle moved at $2 lower prices in the northern dressed market on Thursday. USDA-reported live steers averaged $155.33 this week through Thursday morning, down from last week’s $156.42 average.
Choice beef cutout values fell $1.68 Thursday to $247.28 as movement remained strong at 146 loads.
February live cattle pushed above resistance at the 10-, 20- and 40-day moving averages and rose as high as $155.45, just under this week’s high of $155.50, posted Tuesday, but is still down from $155.875 at the end of last week.

Hog futures are mixed, with nearby contracts weaker and some 2023 contracts slightly firmer.

Neary hogs extended Thursday’s declines and are heading for a sharp loss for the week as a hoped-for bottom in the cash market has yet to materialize.
The CME lean hog index is down 31 cents to $82.47 (as of Dec. 7), the lowest since Jan. 28. December futures are currently about $1.10 under the index, indicating traders expect further weakness.
The national direct weighted hog average sank $3.57 to $81.11. Wholesale pork bounced modestly from 11-month lows to $84.97.
China’s most active live hog futures ended the week down more than 9%, their largest weekly decline on record. Heavy slaughter and weak demand put further pressure on spot cash prices, which plunged 17%. The cash hog price plunge came after producers stepped up slaughter volumes in expectation of improving demand toward the end of the year, and after Beijing urged them to ensure stable supplies.
February lean hogs are trading within the previous session’s wide range and are down sharply from $90.425 at the end of last week. Near-term technicals turned bearish after February futures plunged Thursday to $83.475, the lowest intraday price since $83.025 on Oct. 17.

Tags