After the Bell | February 2, 2022
Corn: March corn futures fell 12 1/4 cents to $6.22 1/2, after rising as high as $6.40 3/4 in overnight trade. December futures fell 4 3/4 cents to $5.73. Profit-taking and prospects for eroding ethanol demand burdened corn futures. U.S. ethanol production averaged 1.041 million barrels per day (bpd) during the week ended Jan. 28, up 6,000 bpd from the previous week, the Energy Information Administration reported. But ethanol stocks increased 1.379 million barrels to 25.854 million barrels, the highest since April 2020. Tomorrow’s weekly USDA export sales report is expected to show net U.S. corn sales of 600,000 MT to 1.3 million MMT for the week ended Jan. 27.
Soybeans: March soybeans rose 16 3/4 cents to $15.45 1/4, the highest close for a nearby contract since June. March soyoil gained 15 points to 65.98 cents, while March soymeal fell 90 cents to $435.10 after reaching a contract high at $447.60 in early trade. Soybean futures posted contract highs for the fifth straight day on fresh export business and expectations South America’s drought-damaged crops will drive more foreign demand to the U.S. StoneX lowered its estimate for Brazil's 2021-22 soybean crop by 7.5 MMT to 126.5 MMT, joining other private forecasters in cutting production expectations for the world’s top soybean exporter. Brazil’s crop totaled 138 MMT last year.
Wheat: March SRW wheat futures fell 14 cents to $7.55, the contract’s lowest closing price since $7.41 1/2 on Jan. 14. March HRW wheat fell 16 3/4 cents to $7.69 1/2, the lowest close since $7.45 on Jan. 14. March spring wheat fell 7 cents to $9.08. Winter wheat fell on profit-taking and prospects for moisture relief in the U.S. Plains. Beneficial snow will continue today and tomorrow in the Plains HRW belt. The snow “will be enough to raise topsoil moisture some when it melts and will be enough to protect crops from subzero Fahrenheit temperatures,” World Weather Inc. said. Tomorrow’s USDA export sales report is expected to show net U.S. wheat sales of 200,000 to 675,000 MT for the week ended Jan. 27.
Cotton: March cotton futures fell 100 points to 126.33 cents per pound, while December futures rose 52 points to 102.95 cents. Cotton futures fell a second straight day as traders awaited tomorrow’s USDA weekly export sales report. Weakness in the U.S. dollar limited price declines. Optimism over the global economy and foreign demand continued to underpin cotton prices, as did beliefs the market must compete for acres with other crops, such as soybeans, as the spring planting season nears.
Cattle: April live cattle rose $1.525 to $146.90 after reaching a contract high at $146.95. February futures gained 82.5 cents to $141.125, the highest close for a nearby contract since March 2016. March feeder cattle rose $3.175 to $166.875, near a three-week high. Cattle futures extended a recent surge off January lows on strengthening cash and gains in outside markets such as crude oil. Negotiated cash cattle trade was reported in the northern market at $140, up around $2.00 from last week, while Southern Plains bids remained around $137.
USDA reported live steers at an average of $139.96 through this morning, compared to last week's average of $136.95. Choice cutout values fell $2.29 to $283.15, near a three-week low. Movement was relatively strong at 130 loads.
Hogs: April lean hogs rose $1.45 to $99.125 after posting a contract high at $100.275, while February futures fell 80 cents to $87.35. Hog futures reached contract highs for a second straight day on stronger cash fundamentals, though prices faded after an initial surge. Wholesale pork prices rose early today but remain down from two-month highs in late January. Retail buyers appear unwilling to purchase pork when cutout values are around $95.00 , raising questions whether today’s gain of $3.47, to an average of $96.44, will be sustained. Hams jumped over $10 to lead gains and movement totaled about 295 loads.
The next CME Lean Hog Index is expected to rise 15 cents to $83.29, the highest since Oct. 21 but a smaller gain than the sharp increases in previous days.