Market Snapshot | September 6, 2023

Corn is 2 to 3 cents higher at midmorning.

• Corn futures are posting mild followthrough gains, with notable gains in the wheat and soy markets providing spillover strength.
• USDA rated the corn crop as 53% “good” to “excellent,” down three percentage points from the previous week. The amount rated “poor” to “very poor” rose one point to 18%. When plugged into the weighted Pro Farmer Crop Condition Index (CCI; 0-500-point scale, with 500 representing perfect), the corn crop dropped 7.7 points to 337.1, which was 2.9 points (0.9%) below last year at this time.
• Mexico is poised to register a new record for corn imports from the U.S., in contrast to declines in other main markets. In the first half of 2023, U.S. corn sales to Mexico totaled $3.027 billion, a 15.1% annual increase. Sales to Japan and China totaled $1.536 billion and $1.242 billion, respectively, down 32.9% and 59.7% annually.
• December corn futures have extended above the 10- and 20-day moving averages of $4.85 1/2 and $4.86 3/4, with additional resistance at $4.94 1/2. Initial support remains at $4.80.

Soybeans are mostly 12 to 16 cents higher, while December meal futures are around $4.50 higher. December soyoil is modestly lower.

• Soybean futures have built on earlier gains, meal providing support.
• USDA rated the soybean crop as 53% “good” to “excellent,” a five-percentage point drop from last week. The portion of the crop rated “poor” to “very poor” rose three points to 17%. When plugged into our CCI, the crop fell 8.5 points to 335.5, down 8.1 points (2.3%) from last year.
• World Weather Inc. forecasts two rounds of precip during the next week will result in at least some rain for nearly all of the Midwest. The moisture will come too late to have much of an impact on crops before rain becomes infrequent Sept. 13-20.
• The Argentine government launched a new “soy dollar” scheme through Sept. 30, which allows exporters to obtain an exchange rate higher than the official rate to encourage them to move inventories.
• November soybeans have pushed above the 10-day moving average near $13.79, with next resistance at $13.90 1/2. Near-term support is in the $13.70 to $13.58 range.  

SRW wheat futures are mostly 14 cents higher, while HRW futures are 20 to 24 cents higher. HRS contracts are mostly around 20 cents higher.

• The wheat complex is being led higher by HRW wheat futures despite persisting U.S. dollar strength.
• USDA reported 74% of the U.S. spring wheat crop was harvested as of Sunday, a 20-point increase from the previous week, but still three points behind the five-year average for early September.
• During a nearly three-hour drone attack on the Ukrainian region of Odesa, several agricultural and port facilities were damaged, and multiple fires were reported in the Izmail district, an important grain exporting hub on the Danube.
• December SRW futures have extended above initial resistance of $6.05 3/4, with additional resistance at the 10-day moving average of $6.12 1/2. Initial support lies around $6.00.

Live cattle are marking solid gains, while feeders are narrowly mixed.

• Live cattle are posting modest gains as traders wait on cash cattle trade to develop.
• Cash trade is unlikely to develop until the end of the week, likely resulting in choppy trade.
• Wholesale beef prices were mixed Tuesday, with Choice up 99 cents to $315.48, while Select dropped 75 cents to $289.54, taking the Choice/Select spread to $25.94. Movement totaled 109 loads for the day.  
• October live cattle are trading within Tuesday’s range, while continuing to find support at the 10- and 20-day moving averages around $180.37. Meanwhile, the 40-day moving average at $180.77 is serving as initial resistance.

Lean hogs are mixed at midsession.

• Nearby lean hogs are facing mild corrective selling, while deferred contracts are posting gains amid notable wholesale strength.
• The CME lean hog index is down another $1.21 to $86.56 as of Sept. 1.
• The pork cutout value surged $5.17 on Tuesday to $98.87, led by an $18 jump in bellies, though all cuts marked gains.
• October lean hogs dropped below Tuesday’s low but remain within the uptrend from the August low. Initial support is the 40-day moving average near $82.255, while resistance is at $84.25.