After the Bell | February 11, 2022
Corn: March corn futures rose 9 1/4 cents to $6.51, a gain of 30 1/2 cents for the week and the highest settlement for a nearby contract since mid-July. December futures rose 10 cents to $5.94 3/4 after posting a contract high at $5.97. Corn futures extended an overnight rebound from yesterday’s losses to end with a fourth consecutive weekly gain, supported by strength in soybeans and prospects for smaller South American crops. Market direction next week will hinge on soybean futures and speculative money flow. Large speculators hold a sizable net long position in corn, which may make the market vulnerable to a fund-driven sell-off if upside momentum falters. A repeat of this week’s disappointing weekly USDA export sales could embolden sellers.
Soybeans: March soybean futures rose 8 3/4 cents to $15.83, a gain of 29 1/2 cents for the week. March soybean meal rose $2.60 to $456.60 per ton, up $12.70 for the week. March soyoil rose 121 points to 65.72 cents per pound. Soybean futures posted the fourth consecutive weekly gain and nearby futures closed at the highest price since June behind fresh export business and a reduced South American crop outlook. Additional cuts to private forecasters’ harvest estimates for Argentina and Brazil next week may support soybean futures, though with this week’s gains, the market appears to have factored in Brazilian production around 125 MMT, which is 9 MMT below USDA’s current projection.
Wheat: March SRW wheat rose 26 1/4 cents to $7.97 3/4, the highest closing price since Jan. 25 and a gain of 34 1/2 cents for the week. March HRW wheat gained 23 1/4 cents to $8.24 1/4, up 38 1/2 cents for the week. March spring wheat rallied 19 1/4 cents to $9.61 1/2, up 48 1/2 cents on the week. Winter wheat futures settled at the highest prices in over two weeks on bargain-hunting in the wake of yesterday’s losses and spillover from strength in corn and soybeans. Today’s bullish weekly high closes bode for followthrough buying early next week. Wheat markets will continue to look to corn and soybeans for direction. Expanding drought in the U.S. Plains states and heightened Russia/Ukraine tensions will remain supportive underlying factors.
Cotton: March cotton fell 38 points to 125.28 cents per pound, down 146 points for the week. The market will remain focused on U.S. export sales and shipments. Weekly sales totals reported this week fell short of previous weeks, compounding USDA’s 250,000-bale cut to its 2021-22 U.S. cotton export forecast. Weekly USDA export sales Thursday will be one key to price direction, while outside markets such as U.S. equities and crude oil could also exert influence.
Cattle: April live cattle futures fell 70 cents to $146.175, down 70 cents for the week. March feeder cattle fell 50 cents to $166.225, up 12.5 cents for the week. Cattle futures fell under long liquidation and corrective selling following the rally to contract highs earlier in the week. Cash cattle prices climbed this week as packers accelerated slaughter, with live steers through this morning averaging $140.35, up from last week’s average of $139.76. Choice cutout values fell 30 cents to $274.52, a five-week low. But packer margins remain deep in the black, and with fed cattle supplies at or near usual annual lows, cash prices may continue rising over the short term.
Slaughter this week was an estimated 659,000 head, up 20,000 from last week and up 53,000 head from the same week in 2021, USDA reported.
Hogs: April lean hog futures fell $1.20 to $102.225 but gained $2.30 for the week, the market’s sixth weekly gain in the past seven. Yesterday’s technically bearish “key reversal” lower in lean hogs was confirmed by followthrough selling today. Further futures weakness early next week would suggest a market top has been established. Cash market fundamentals remain supportive . Pork cutout values soared $8.48 today to a four-month high at $109.96, led by a gain of over $22 in hams. Movement totaled about 282 loads. The next CME lean hog index is expected to rise $1.18 to $88.92, the highest since Oct. 12. Meatpackers slaughtered 2.516 million head of hogs this week, up 71,000 head from last week and but down 127,000 head, or 4.8%, from the same week last year.
