Market Snapshot | August 8, 2023

Corn is mostly 2 to 3 cents higher at midmorning.

• Corn futures have rebounded from earlier lows but continue to consolidate sideways.
• USDA rated 57% of the corn crop as “good” to “excellent,” as of Sunday, which was a two-percentage-point increase from the previous week. The portion rated “poor” to “very poor” slid one point to 14%. On the weighted Pro Farmer Crop Condition Index (CCI; 0 to 500-point scale, with 500 representing perfect), the corn crop improved 4.4 points to 348.7, which was only 3.3 points (0.9%) below last year at this time.
• Crop consultant Dr. Michael Cordonnier kept his corn yield estimate at 174 bu. per acre, but now notes a neutral to higher bias due to recent rains and moderate temps. Cordonnier estimates production at 15.01 billion bushels.
• December corn is trading within Monday’s range, with support lying at $4.89 1/2, while resistance continues to serve at $5.01 1/2.

Soybeans are trading mostly 3 to 4 cents lower, while September meal futures are nearly $2.00 lower. September soyoil is around 80 points lower.

• Soybean futures are facing followthrough selling amid favorable forecasts but have rebounded from a test of the 100-day moving average early in the session. 
• USDA rated 54% of the soybean crop as “good” to “excellent,” a two-point increase from last week. The amount rated “poor” to “very poor” fell one point to 14%. On our weighted CCI, the soybean crop improved 4.3 points to 340.1, but is still 11.1 points (3.2%) below last year.
• Cordonnier left his soybean yield estimate unchanged at 50.5 bu. per acre, but now indicates a neutral to higher bias. Cordonnier estimates production at 4.17 billion bushels.
• World Weather Inc. maintains weather during the next 10 days will feature multiple rounds of rain in nearly all major production areas along with a lack of heat. The forecaster notes, a close watch will be made on the rainfall distribution from northeastern North Dakota to south-central and southeastern Minnesota to east-central and northeastern Iowa where soil moisture is short and rain is needed.
• China imported 9.73 MMT of soybeans in July, down 5.3% from June but 23.4% more than last year. Through the first seven months of this year, China imported 62.3 MMT of soybeans, a 15.0% increase from the same period last year.
• China’s overall imports dropped 12.4% from last year to $201.16 billion in July, the steepest decline since January amid weak domestic demand. Exports fell 14.5% to $281.76 billion, the steepest drop since February 2020 amid slowing global demand.
• November soybeans tested the 100-day moving average of $12.89 1/2 for the first time since June 30. Additional support lies at $12.70 1/2, while resistance stands at $13.06 1/2.

SRW wheat is narrowly mixed, while HRW is mostly 4 to 5 cents higher. HRS contracts are 6 to 9 cents higher.

• Wheat futures have rebounded from earlier lows despite notable U.S. dollar strength as traders continue to mull over global supply implications due to persisting Black Sea tensions.
• USDA rated 41% of the U.S. spring wheat crop as “good” to “excellent,” down one point from the previous week. The amount of the crop rated “poor” to “very poor” increased four points to 20%. The spring wheat CCI rating fell another 5.2 points to 321.6, which was 46.2 points (12.6%) below year-ago. Top producer North Dakota accounted for 2.6 points of the decline.
• Russia’s lack of ships and Western grain traders’ shrinking appetite for business with Mosco are adding to rising costs of moving Russian wheat at a time when war in Ukraine has spilled perilously close to vital Black Sea supply routes.  
• Ukraine’s 2023 grain crop may reach 50 MMT to 55 MMT, compared to 53 MMT in 2022, according to the first deputy Ukrainian agriculture minister. The increase is mainly due to higher-than-expected yields.
• September SRW futures are trading within Monday’s range, with the previous session’s high of $6.63 3/4 providing initial resistance, while support remains at $6.41. 

Live cattle are mixed, while feeders are posting strong losses.

• Live cattle are mostly lower as traders anticipate lengthy cash cattle negotiations.
• The average cash cattle price firmed $1.89 to $186.70 last week, the second highest ever behind the record of $188.75 for the week ended June 9. Packers bought a stronger-than-expected 83,000 head amid the higher cash prices, which along with slowing slaughter rates, will likely encourage them to drag out cash negotiations this week.
• Wholesale beef prices dropped Monday, with a 30-cent decline in Choice to $301.49, while Select fell $1.47 to $275.01, taking the Choice/Select spread to $26.48. Movement slipped to 91 loads for the day.
• October live cattle have descended below the 20- and 10-day moving averages of $181.21 and $180.71, respectively, with additional support serving at $179.98. Meanwhile, initial resistance stands at $182.65.

Lean hogs are mixed, with the nearby contracts posting gains.

• Nearby lean hog futures are firmer, with traders narrowing the steep discount to the cash index.
• The CME lean hog index is down 43 cents, marking the biggest daily decline since what appears to be the seasonal peak was posted and the fifth decline in the last seven days.
• The pork cutout value rose $1.62 Monday to $115.31, while movement totaled 250.3 loads for the day.
• October lean hogs are trading within Monday’s range, with initial resistance at $86.34, while support lies around $84.56.