10:30 Market Snapshot | December 20, 2023

Market Snapshot
Market Snapshot
(Pro Farmer)

Corn futures are steady to a penny lower at midmorning. 

  • Corn futures are chopping around unchanged, with weakness in wheat and soymeal providing bears the slightest of upper hands. 

  • Brazil overtook the U.S. in November to become China’s biggest corn supplier this year. China imported 3.22 MMT of corn from Brazil last month, pushing the tally for the first 11 months of 2023 to 8.8 MMT – 39.7% of its total. China imported 6.5 MMT of U.S. corn through November – 29.3% of its total.

  • Agriculture consultancy APK-Inform increased its 2023 Ukraine grain production forecast by 1.6 MMT to 56.3 MMT amid a larger corn crop. APK-Inform now forecasts Ukraine’s 2023-24 grain exports at 38.1 MMT, including 22 MMT of corn. 

  • March corn futures are leaning on support at Tuesday’s low of $4.71 1/2. Contract-low support is at $4.70 1/2. The 10-day moving average near $4.76 1/2 is near-term resistance. 

 

Soybeans are 2 cents lower to 4 cents higher, while meal futures are $3.00-plus lower. Soyoil futures are modestly firmer.

  • Soybean futures are holding in tight trading ranges in relatively directionless price action. 

  • Brazil rainfall increased in eastern and southern Bahia and northern Minas Gerais Tuesday and early today with some lighter rain west northwest through southern Goias to northern Mato Grosso do Sul and Mato Grosso. Weather Inc. says center-west, center-south and northeastern Brazil will see improved rainfall during the next week, reducing crop stress and improving crop conditions. But more rainfall will be needed after prolonged drought and the rains came too late for early maturing soybeans. 

  • Conditions are expected to remain mostly favorable across southern Brazil, much of Argentina’s main production area, Paraguay and Uruguay. 

  • China imported 5.29 MMT of soybeans from Brazil in November, increasing this year’s total to 64.97 MMT. China’s imports of U.S. soybeans totaled 2.3 MMT last month for a total of 20.36 MMT through November.

  • January soybeans are trading near the middle of the recently established range from $12.92 to $13.44. Tighter boundaries extend from $13.02 1/2 to $13.28 3/4.

 

SRW wheat futures are around a nickel lower, HRW contracts are mostly a dime lower, while HRS futures are 5 to 7 cents lower.

  • Wheat futures are weaker as the recent back-and-forth price action continues amid a lack of market-moving news.  

  • Forecasts calling for rains/snow across the central U.S. are helping pressure wheat. World Weather says rains and some snow will fall on the Plains late this week through the Christmas holiday weekend. SRW of the Midwest will also receive some moisture. 

  • SovEcon raised its Russian 2024 wheat production forecast by 1.5 MMT to 91.3 MMT as recent rains and snow have provided improved moisture conditions for the winter wheat crop. That would still be 400,000 MT smaller than SovEcon’s estimate of Russia’s wheat crop this year.

  • March SRW futures remain hemmed in a range from yesterday’s low at $6.23 to this month’s high at $6.77 1/2.

 

Live cattle are slightly lower at midmorning, while feeders are mixed. 

  • Live cattle futures are favoring the downside in relatively quiet price action, though seller interest is building in deferred contacts. 

  • Nearby feeder cattle futures are slightly lower, while mild strength is being seen in some of the far-deferred contracts. 

  • Traders prepare for USDA’s Cattle on Feed Report Friday afternoon and await direction from the cash cattle market. 

  • Cash cattle negotiations have been slow to develop and it appears there won’t be active trade until late in the week. 

  • Choice cutout fell 10 cents to $288.83 on Tuesday, while Select dropped 56 cents to $263.16.

  • February live cattle are trading below the uptend line from the recent lows. Near-term support is at the 10-day moving average at $167.58. The 20-day moving average near $168.89 lines up closely with the broken uptrend to form resistance. 

 

Lean hogs are mixed with a mostly weaker tone at midsession.

  • February hogs are holding near unchanged, while deferred contracts are facing light selling pressure. 

  • The CME lean hog index is down another 22 cents to $66.37 (as of Dec. 18), extending the seasonal price drop.

  • The pork cutout value dropped 91 cents on Tuesday to $83.06. While wholesale pork prices have held up better than the cash hog market, that was a new low on the seasonal decline.
  • February lean hogs gapped lower on the open but have filled the gap. Today’s low at $69.75 is initial support. Resistance is in the $71.00 to $72.50 range. 

 

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