Market Snapshot | January 24, 2024

Corn futures are 2 to 4 cents higher at midmorning.

• Corn futures are higher for the fifth straight session, marking gains in step with wheat amid a weaker U.S. dollar.
• Brazil’s corn exports are seen reaching 3.86 MMT in January versus 4.86 MMT a year ago, according to Brazilian exporter association Anec.
• World Weather Inc. reports Argentina will be drying down over the next 10 days, increasing the need for widespread rain soon as both the far northern and southern parts of the nation experience moisture stress. Weather in this first week may offer a little concern, but no change in potential production is likely, though it will be important for rain to develop in early February.
• Ethanol production during the week ended Jan. 19 plunged to 818,000 barrels, down 236,000 barrels per day (bpd) (22.4%) from the previous week and 217,000 barrels (21.0%) from last year. That was the lowest weekly production figure since the week ended Feb. 19, 2021. Ethanol output was slowed by cold weather that caused some plants to cut production and hefty stocks. Ethanol stocks rose 120,000 barrels to 25.815 million barrels.
• March corn futures are hovering above the 10-day moving average, currently trading at $4.48, though $4.50 continues to serve as solid resistance. Meanwhile, initial support is at Tuesday’s close of $4.46 1/2.

Soybean futures are chopping around unchanged, while March soymeal is around $1.00 higher. March soyoil is about 25 points lower.

• Soybeans are pausing following four straight days of gains.
• Brazil’s Goiás state will harvest between 13.8 MMT and 15.2 MMT of soybeans in the 2023-24 season, which would be a 22% drop in production if near the low-end range and 14% if production lands closer to the high end of the range.  The wide range is due to the uncertainty of weather conditions between now and the end of harvest.
• Brazil soybean exports are seen reaching 2.3 MMT in January versus 940,000 MT in January 2023, according to Anec. Soymeal exports of 2.2 MMT are expected, compared to 1.43 MMT a year ago.
• Frequent rain will fall on much of northern Brazil during the next two weeks, slowing fieldwork across the region, while central and eastern Mato Grosso do Sul to Santa Catarina, Parana and Sao Paulo will see a good mix of rain and sunshine, according to World Weather.
•  March soybeans are facing resistance at $12.46 1/4, while support is at $12.33 3/4. Additional resistance/support stands at the 20-day moving average of $12.53 3/4 and $12.14 3/4.

SRW wheat futures are mostly 7 cents higher, while HRW and HRS contracts are 2 to 3 cents higher.

• SRW wheat futures are moderately higher but continue to face notable overhead resistance, which is capping momentum.
• Black Sea consulting firm SovEcon raised its 2024 Russian wheat production forecast 900,000 MT to 92.2 MMT, citing favorable weather conditions. At that level, production would be down 600,000 MT (0.6%) from last year’s crop.
• Russian wheat exports have become more diversified through the first half of 2023-24 compared to the same period the previous year, indicating the country has retaken its status as the cheapest origin globally, according to Agricensus. Russia has ended the first six months of the current season with a new record for wheat exports, building on last year’s biggest-ever export figures.
• March SRW futures are trading within the previous session’s range and continue to face resistance at the 20-, 100- and 40-day moving averages in the $6.05 1/2 to $6.08 3/4 range. Meanwhile, the 10-day moving average of $5.94 3/4 serves as initial support.

Live cattle are mixed while feeders are marking gains.

• Nearby live cattle continue to find support from improving wholesale fundamentals.
• Wholesale beef prices continued to move higher on Tuesday, with Choice rising $2.99 to $301.66 and Select gaining $1.80 to $288.38. The increases are pushing packer margins back into the black, which should give packers incentive to more actively bid for market-ready supplies.
• USDA will detail frozen meat stocks at the end of December this afternoon. The five-year average is an 8.9-million-lb. increase in beef stocks.
• February live cattle have extended above resistance at $175.23 for the first time since Nov. 24, with additional resistance at $175.80. Initial support lies at $174.35.

Lean hogs are mostly firmer at midsession.

• February hog futures are facing notable overhead technical resistance and near-term overbought conditions, which are limiting buying efforts.
• The CME lean hog index firmed another 35 cents to $68.75 as of Jan. 11 and has risen $3.70 from the seasonal low formed at the beginning of the month.
• The pork cutout value fell $2.14 to $88.03 amid drops in all cuts except primal ribs. Movement totaled 356.9 loads.
• USDA will report frozen meat stocks at the end of December this afternoon. The five-year average is less than a million-lb. rise in pork stocks during the month.
• February lean hogs are facing resistance at the 100-day moving average of $73.26, while initial support lies at the 10-day moving average of $71.79.