Market Snapshot | June 16, 2023

Market Snapshot
Market Snapshot
(Pro Farmer)

Corn is 8 to 14 cents higher at midmorning, with new-crop posting stronger gains.

  • Corn futures are extending Thursday’s strong gains amid continuing concerns over dry Midwest weather and the effects on production.
  • Forecasts remain dry over much of the Corn Belt during the next week to 10 days, with periods of hot temps also likely, notes World Weather Inc. The driest areas will be the central and eastern Corn Belt, as weather events in the Gulf of Mexico keep those rains in the Southeast and out of the central U.S.
  • In Ukraine, corn planting areas exceeded forecasts by 11%, according to the Ministry of Agrarian Policy of Ukraine.
  • July corn has extended above the 100-day moving average of $6.20 1/2 and resistance at $6.30 3/4, with $6.38 1/4 serving up the next area of resistance. The 100-day moving average is providing support.

Soybeans are 32 to 42 cents higher, while July meal futures are more than $17.00 higher. July soyoil is over 130 points higher.

  • The soy complex is surging higher, with looming weather concerns driving futures higher.
  • World Weather reports dryness is most significant in Illinois, eastern Iowa and some areas in southeastern Minnesota and southwestern Wisconsin, with rain unlikely in the next 10 days.
  • Malaysian palm oil futures soared more than 6% on Friday as dry weather curbed prospects of palm and U.S. soybean production, setting the contract up for a sharp weekly jump.
  • July soybeans have edged notably above the 100-day moving average of $12.95 1/2 as well as resistance at $13.11 1/4, $13.30 1/4 and the 200-day moving average of $13.34 3/4. The next area of major resistance stands at $13.65 1/2, while support lies around $12.76.

SRW wheat is 25-plus cents higher, while HRW is showing gains in excess of 30 cents. HRS wheat is 18 to 20 cents higher.

  • The wheat complex is notching strong gains in tandem with corn and soybeans as global supply concerns increase.
  • It is “impossible” to extend the Black Sea grain deal under current circumstances, the speaker of Russia’s upper house of parliament, Valentina Matviyenko said, Interfax news agency reported. Matviyenko said, “the limits of our patience…have been exhausted,” reiterating comments made earlier this week by President Vladimir Putin and other senior Russian officials. 
  • Russia lowered its wheat export tax for the nineth straight week. The tax for June 21-27 will be 2,612.9 rubles ($31.10) per metric ton based on an indicative price of $250.30. That’s down from a rate of 2.629.6 rubles per metric ton the previous week and the lowest since the week of Oct. 12-18, 2022.
  • July SRW wheat has traded as high as $6.97, the highest level since April 20, and has reached above resistance of $6.75, $6.88 1/2 and the 100-day moving average of $6.88 1/4. The next major resistance level stands at $7.12, while support lies around $6.51 1/2.

Live cattle are marking gains, while feeders are higher despite strength in corn.

  • Live cattle are posting solid gains, indicating a near-term low was established on Thursday.
  • Cash cattle trade so far this week occurred at lower prices, though not enough traded for a true test. Packers are trying to buy cattle at lower prices after a recent string of record highs, but feedlots aren’t showing much interest in moving cattle at these levels. The average cash price will likely be lower this week, but movement is also expected to be light.
  • Wholesale Choice beef prices continue to climb, with another $3.01 gain on Thursday to $342.07, while Select rose 32 cents to $309.58, widening the Choice/Select spread to $32.49. Movement was light for the day at 83 loads.
  • August live cattle are trading narrowly, mostly within the upper end of Thursday’s range, with initial resistance serving at $171.97 and support lying at $170.81.

July lean hogs are notably higher at midsession, while deferred contracts are weaker.  

  • July lean hogs are pushing higher as firming cash fundamentals continue to underpin the market. Deferred contracts are facing some light profit-taking.
  • The CME lean hog index continues to firm, rising another 62 cents on Thursday to $86.87 as of June 14.
  • The pork cutout value climbed another $1.16 Thursday to $90.89, signaling an increase in retailer demand given hefty wholesale beef prices.
  • August lean hogs have edged has high as $92.00, the highest level since early May, before retreating from that level, while Thursday’s close of $90.30 is serving as initial support.
 

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