Market Snapshot | September 1, 2023

Corn 2 to 3 cents higher at midmorning.

• Corn futures continue to show strength despite selling efforts after this morning’s reopen.
• World Weather Inc. says there are increased chances of rain for next Thursday through Sept. 13, though a widespread soaking is unlikely.
• Dwindling water levels on the Mississippi River are raising shipping costs. Barge rates in St. Louis have already surged 49% week-over-week. Falling river levels are likely to lead to further weight restrictions if current forecasts hold true.
• Corn-for-ethanol use is expected to total 462.7 million bu. in July, up 21.2 million bu. (4.8%) from the previous month and 16.9 million bu. (3.8%) more than last year, according to a Bloomberg survey.
• December corn defended line-in-sand support as prices rally to start September. Buying efforts have stalled out at 10-day moving average resistance at $4.85 1/2, while $4.91 marks the next resistance level. Bears are aiming to take out $4.77 support.

Soybeans are narrowly mixed and December meal futures are around $3.00 lower. December soyoil is around 50 points higher.

• Soybean futures are struggling to hold onto overnight corrective gains.
• Temperatures are expected to warm to above average today and will be much warmer than normal early next week, with highs in the upper 90’s and lower 100’s likely in the western Corn Belt, World Weather Inc says. Temperatures are expected to turn cooler Wednesday and continue cooling into next weekend.
• Traders expect USDA to report soybean crush totaled 184.0 million bu. in July, based on a Bloomberg survey. That would be up 9.5 million bu. (5.4%) from June and 2.6 million bu. (1.4%) greater than July 2022.
• USDA reported daily soybean sales of 198,000 MT to unknown destinations for 2023-24. That marks the sixth trading day in a row with daily soybean sales to China or unknown destinations, totaling 1.259 MMT over that period.
• November soybeans traded as high as $13.85 before buying efforts stalled, bulls are aiming to defend $13.71 support. Bears marked initial resistance at $13.85.

SRW wheat futures are 3 to 5 cents higher, while HRW futures are mostly 6 to 9 cents higher. HRS contracts are 2 cents higher.

• SRW wheat futures are seeing solid gains though still trading below yesterday’s high.
• Russian led forces are staging joint military exercises in Belarus near the border with Poland as the two strengthen political ties. Russia has warned any aggression towards Belarus will be treated as a threat to his own nation.
• Ukraine says it pierced a Russian defense line in southern Ukraine as Ukrainian forces lead a counter-offensive.
• December SRW futures have traded in an “inside day” thus far as price consolidates this week’s leg lower. Bulls are aiming to defend the psychological $6.00 level, which has been protected on a closing basis all week despite continued efforts by bears. Bulls are targeting initial resistance at $6.17.

Live cattle and feeders are facing losses at midsession.

• Live cattle are facing losses as cash trade has not lived up to traders’ expectations.
• Volume in the cash market more than tripled from earlier in the week, though still remained fairly light on the week. Trading occurred in the south as the cash average for the week fell to $184.77, though still above last week’s average.
• Wholesale beef prices continue this week’s slide as Choice cutout fell $1.32 to $313.79 and Select fell 28 cents to $289.25. Movement remains solid indicating packers still have inventory to sell despite the downtick in demand as the summer grilling season is nearing an end, which could keep pressure on prices in the interim.
• October live cattle futures are holding within Thursday’s range so far today, supported by $179.60 support. This will be a key level ahead of the weekend. Bulls are aiming to take out $181.00 resistance on a closing basis.

Lean hogs are mostly weaker at midsession.

• Lean hogs are trading within Thursday’s range and continue to struggle against technical resistance.
• The CME lean hog index fell $1.41 to $89.26 on Wednesday, narrowing the spread with front-month futures to just over $7. With a recent bullish bias in early September in the cash market, futures could quickly be playing catchup if the bias hold true.
• The pork cutout value rose 10 cents to $92.22 on Thursday as movement slowed down and bellies stabilized. Values are still at the lowest level since mid-June and nearly $13 below last week’s high, so some basing is not unlikely.
• October lean hogs have struggled against $83.15 resistance, though are still posting impressive gains on the week. Bulls are aiming to defend $82.00 support, quickly backed by $81.80.