After the Bell | August 9, 2021
Corn: December corn futures fell 2 3/4 cents to $5.53 3/4 a bushel. Commodities in general were under pressure today as crude oil futures tumbled on escalating COVID concern. Recent beneficial rains in the Corn Belt were also a slight negative for the corn market. More precipitation is seen in the eastern Corn Belt this week, but the western Corn Belt won’t see much rain, World Weather Inc. said. USDA today reported U.S. corn inspected for export the week ended Aug. 5 totaled 667,220 metric tons (MT), down from 1.4 million MT (MMT) last week and the lowest of this marketing year. USDA’s latest weekly crop condition ratings showed the corn crop at 64% “good” or “excellent” as of yesterday, up from 62% a week ago and about two percentage points above expectations. Traders await Thursday’s USDA Crop Production Report, which is expected to show slightly lower U.S corn production compared to USDA’s July forecast of 15.165 billion bushels.
Soybeans: November soybeans fell 7 cents to $13.29 3/4 a bushel, December soymeal rose $1.80 to $359.50 per ton and December soyoil fell 133 points to 59.94 cents per pound, the lowest close in a month. Soybean futures traded both sides of unchanged today, with soyoil providing spillover pressure and soymeal support. The weather picture was a mixed bag as weekend rains weren’t as widespread or heavy as expected across the western Corn Belt, though some areas received favorable precipitation. This week’s forecast doesn’t call for any significant rainfall in the western Corn Belt, but the GFS midday weather model increased rain chances for a good portion of the region next week. USDA reported 60% of the soybean crop in good-to-excellent condition as of yesterday, unchanged from the previous week and down from 74% a year ago. The good-to-excellent rating matched trade expectations.
Wheat: September SRW futures fell 7 3/4 cents to $7.11 1/4 a bushel. September HRW fell 4 1/4 cents to $7.01 1/2, while September spring wheat fell 7 1/2 cents to $9.08 3/4. Wheat futures started the week on a soft note amid pressure from general weakness in commodity markets, including a drop of more than 2% in crude oil futures. Prospects for stronger exports and smaller supplies globally underpinned prices. Wheat inspected for export for the week ending Aug. 5 totaled a stronger than expected 605,793 MT, up from 405,215 MT the previous week, USDA reported today. USDA’s Crop Production and Supply and Demand reports Aug. 12 are expected to convey a tighter picture for U.S. and global supplies. USDA is expected to trim U.S. wheat ending stocks for 2021-22 to 644 million bu., based on the average analyst estimate. USDA currently estimates ending stocks at 665 million bushels.
Cotton: October cotton futures fell 112 points to 91.30 cents per pound, while December futures fell 80 points to 90.90 cents. Cotton futures fell for the first time in five days amid pressure from general weakness in commodity markets, including crude oil’s slump to the lowest prices since late May. U.S. dollar strength also weighed on cotton futures. Underlying fundamentals remain mostly bullish for cotton, with domestic and foreign demand expected to strengthen as the global economy recovers from the pandemic, though the recent surge in Covid-19 cases from the Delta variant is concerning. USDA reported 65% of the U.S. cotton crop in good-to-excellent condition at the start of this week, up from 60% a week ago and up from 42% a year ago.
Hogs: October lean hogs dropped the $3 daily limit to $84.60 per hundredweight, the lowest closing price since July 8. Trading limits expand to $4.50 for tomorrow’s session. Deferred hog futures faced active chart-based selling and liquidation pressure, despite their big discounts to the cash index. October lean hog futures finished $26.61 below where the cash index will be quoted tomorrow. Over the past five years, the cash index has an average decline of $4.42 from Aug. 9 through Oct. 18 (the contract settlement date). That signals traders anticipate a much more aggressive than normal seasonal price drop, or they have overdone the downside. The average national direct cash hog price was 78 cents lower early today. While the cash market is softening, the pork cutout value is strengthening, rising $5.71 this morning to $129.38 per hundredweight and led by a surge in belly and ham prices.
Cattle: October live cattle closed down 40 cents at $127.475 per hundredweight. October feeder cattle closed down 7.5 cents at $165.70. The cattle futures markets today saw limited buying interest as lean hog futures plunged. Selling pressure across much of the raw commodity sector today, led by solid losses in crude oil futures, also kept buyers in cattle futures mostly on the sidelines today. Cash cattle market fundamentals still favor the bulls. Choice boxed beef values rose another $2.03 early today, to $298.29, marking the 13th consecutive day of gains. Cash cattle trading this week is seen near steady, but futures prices must remain stable to attain such. Last week’s average cash cattle price was $123.83, up from $121.68 the previous week and up from $101.34 a year earlier.
