Market Snapshot | August 10, 2023

Corn is mostly 2 cents higher at midmorning.

• Corn futures are posting mild gains but are rangebound as traders position themselves ahead of Friday’s USDA crop reports.
• USDA reported net corn sales of 150,400 MT for 2022-23 in week ended Aug. 3, which rose 40% from the previous week but were down 47% from the four-week average. Net sales of 758,400 MT were reported for 2023-24. Traders expected sales to range from 75,000 to 600,000 MT for 2022-23 and 200,000 to 600,000 MT for 2023-24.
• According to the U.S. Drought Monitor, Midwest drought declined by more than four percentage points, but nearly 72% of this region was still too dry. Iowa remained 100% covered in drought despite some rain over the past week. Further east, there were decreases in drought areas. Illinois had a nearly a 10-point decrease to 85.4% too dry while Indiana decreased 23 points to 30.5% in a dry category.
• Conab raised its official Brazilian corn crop estimate 2.2 MMT to a record 129.9 MMT, as safrinha production is expected to be higher than previously forecast. Conab also raised its 2022-23 Brazilian corn export forecast to 50 MMT, up 2 MMT from its prior outlook.
• December corn continues to trade narrowly sideways with the 10-day moving average of $5.02 1/2 serving as resistance, while support remains at $4.90 1/2.

Soybeans are trading mostly 12 to 13 higher, while September meal futures are less than $1.00 higher. September soyoil is trading around unchanged.

• Soybean futures are higher for the third straight session, though a weak technical posture is curbing buyer interest.
• USDA reported net soybean sales of 406,600 MT for 2022-23, which rose sharply from the previous week but were down 47% from the four-week average. Net sales of 1.096 MMT were reported for 2023-24, primarily to China (753,000 MT) and unknown destinations (314,000 MT). Traders expected sales of 0 to 300,000 MT for 2022-23 and 300,000 MT to 1.5 MMT 2023-24.
• World Weather Inc. reports crop development and production potential has improved for many areas in the Midwest in recent weeks with the exception of some of the drier areas in northeastern Iowa, Minnesota and a handful of locations in Kansas, Illinois and Wisconsin.
• Conab raised its Brazilian soybean crop estimate by 100,000 MT to a record 154.6 MMT but kept its 2022-23 Brazilian soybean export forecast at 95.6 MMT.
• November soybeans have posted an intraday high of $13.28 in a test of resistance at the 10-day moving average of $13.27 1/4. An extension above the area would find additional resistance at the 200-day moving average of $13.33 1/4. Initial support lies at $13.02 1/4.

SRW wheat is mostly 1 to 3 cents higher, while HRW is mostly 2 to 4 cents higher. HRS contracts are around a penny lower.

• Winter wheat futures are posting mild gains amid weakness in the U.S. dollar and light corrective buying.
• Net wheat exports sales of 567,000 MT for 2023-24 were a marketing-year high, and up 35% from the previous week and 86% above the four-week average. Traders expected sales of 200,000 to 500,000 MT for 2023-24.
• The Ukrainian navy announced a temporary “humanitarian corridor” in the Black Sea is now operational. The first ships are expected to use this corridor in the coming days. A spokesperson for the Ukrainian navy told Reuters the corridor would be used by commercial ships blocked at Ukraine’s Black Sea ports to transport grain and agriculture products.
• September SRW futures are trading narrowly within Wednesday’s range, with the 10-day moving average of $6.50 3/4 providing initial resistance, while support remains at $6.26 1/4.

Live cattle and feeders are posting moderate to strong gains.

• Live cattle futures are higher as traders anticipate cash cattle prices will firm again this week.
• While cash activity has been light thus far, traders are anticipating feedlots will have the upper hand when trade eventually turns active.
• Wholesale beef rose Wednesday, with Choice gaining $1.13 to $303.52 while Select charged $1.98 higher to $278.14, while movement totaled 125 loads.
• USDA reported net beef sales of 14,800 MT for 2023, which were up 19% from the previous week but down 8% from the four-week average.
• October live cattle have traded above resistance at $182. 21, with the next area of resistance at $182.72. The 20-day moving average of $181.41 is providing initial support.

Lean hogs are lower at midsessioin.

• Nearby lean hog futures are mildly lower, given their discount to the cash market, while deferred futures are encountering heavy followthrough selling.
• The CME lean hog index is down another 24 cents, marking the seventh decline in the last nine days.
• The pork cutout value dropped $2.97 to $109.12, led lower by a $9.79 drop in primal bellies.
• USDA reported net pork sales of 22,300 MT for 2023, which were up 25% from the previous week and 3% above the four-week average.
• October lean hogs gapped lower at the open and have dropped below the 100-day moving average of $80.56 for the first time since July 19. Additional support lies at $79.66, while resistance stands at Wednesday’s close of $81.575.