After the Bell | November 1, 2021

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Corn: December corn futures surged 10 3/4 cents to $5.79, the contract’s highest close since $5.79 1/4 on July 2. The lead contract is up 13% since settling at a one-month low at $5.12 1/4 Oct. 13. December corn extended last week’s 5.6% gain to reach the highest settlement in four months with spillover support from the wheat market’s rally to multi-year highs. Wheat prices are rallying behind stronger demand and a tightening global supply outlook for 2022, raising the prospect that high-priced wheat may be a more appealing option than corn for some farmers. USDA late today reported the U.S. corn crop was 74% harvested as of the start of this week, up from 66% the previous week and ahead of the five-year average for that date, also 66%. The report was expected to show 75% of the crop harvested. Also today, USDA reported weekly corn export inspections totaling 619,340 MT during the week ended Oct. 28, down from 634,864 MT the previous week. In its monthly Grain Crushing report, USDA estimated corn processed for fuel alcohol in September totaled 407.5 million bu., down from 414.2 million bu. in August but up from 402.4 million bu. in September 2020.

Soybeans: January soybeans fell 1 cent to $12.48 1/2 and near mid-range. December soybean meal fell $3.50 to $329.10 and near the session low. December soyoil rose 70 points to 61.97 cents and near the session high. Even with solid gains posted in corn and wheat futures today the soybean market could not even muster slight gains. Soybean traders seemingly ignored USDA today reporting another daily U.S. soybean sale of 132,000 MT to China for 2021-22 delivery. Weekly U.S. soybean export inspections totaled 2.272 MMT, down from the previous week’s figure, which was revised up more than 400,000 MT from the initial number. U.S. inspections numbers for soybeans are running about in line with seasonals for this time of year. U.S. soybean crushings declined to 164.1 million bu. in September, down from 168.2 million bu. processed in August and below the September 2020 crush of 171.0 million bushels. Traders expected the figure to be 163.6 million bushels. The soybean crop was 79% harvested at the start of this week, up from 73% a week earlier and slightly behind the average of 81% for the previous five years, USDA said. Analysts expected the harvest to be 81% finished.

Wheat: Wheat futures finished mostly 20-plus cents higher on the day. December SRW wheat gained 24 1/2 cents to $7.97 1/4, the highest settlement for a nearby contract since December 2012. December HRW futures rose 20 3/4 cents to $8.06 1/2, the highest closing price for a nearby contract since May 2014. December spring wheat futures rose 23 1/4 cents to $10.75 1/2.

U.S. wheat futures were boosted by rising international prices and strong global demand. Euronext wheat futures surged to a 13 1/2 year high amid a bigger-than-expected 1.26-MMT purchase by Saudi Arabia. Also, Russia bought 180,000 MT of Russian wheat. While U.S. wheat isn’t competitively priced on the global market, there is a lot of wheat changing hands as prices rise, which is supporting the U.S. wheat price surge. Wheat export inspections were the lowest total for any week ever at just 4.2 million bushels. That came on the heels of inspections of only 7.3 million bu. the previous week. Given the U.S. export struggles, there’s would be justification for USDA to cut its export forecast next week. The winter wheat crop was rated 45% “good” or “excellent” at the start of the week, down from 46% a week ago.

Cotton: December cotton futures soared 499 points to 119.84 cents after reaching a daily limit high at 119.85 cents. Futures have rallied 28% since mid-September. Cotton futures extended the past month’s rally on expectations strong global demand will absorb a large U.S. harvest. China is reported to have been an active buyer, and reports of insect boll worm infestations in key crop areas of India, further fueled bullish sentiment. Stronger crude oil future and a rally to multiyear highs in wheat markets underscored a strong bullish sentiment across global commodities. USDA reported the U.S. crop was 45% harvested as of yesterday, up from 35% harvested a week prior but below the average of 48% for the previous five years.

Cattle: December live cattle futures fell 42.5 cents to $128.85, the lowest closing price since Oct. 22. January feeder cattle fell $3.40 to $152.725, the contract’s lowest settlement since $151.975 on May 11. Live cattle futures extended a downtown late last week to close at the lowest level in over a week. Futures appeared to have established a near-term peak last week and will require further strength in cash markets and boxed beef to extend gains. Boxed beef prices are starting to pull out of a two-month slump, with Choice cutout values rising $1.86 to $287.58, near a four-week high, though movement was light at 82 loads. Cash cattle are building momentum higher, though it will likely take toward the middle of the week to establish a discernable tone. On Friday, live steers in five top feedlot regions averaged of $126.29, up nearly $1.90 from the previous week and the fourth consecutive weekly gain.

Hogs: December lean hog futures rose 7.5 cents to $76.15 and near mid-range. February and other deferred contracts ended higher. Hog futures saw little followthrough from sharp gains late last week, with still-weak cash market fundamentals weighing on futures. However, there are signs that the wholesale pork market’s downturn may have spurred renewed consumer demand. The outlook for smaller U.S. pork supplies early next year continues to support deferred futures. USDA reported pork cutout values down $4.08 at $92.44. Movement totaled nearly 336 loads. The national direct cash carcass price fell 67 cents to $61.03. The latest CME lean hog index fell 81 cents to $79.89, the lowest since Feb. 12. Today’s hog slaughter was estimated at 481,000 head, compared to 478,000 last Monday and 492,000 one year ago.

 

 

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