After the Bell | September 20, 2021

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Corn: December corn futures fell 5 1/2 cents to $5.21 3/4 a bushel. Corn got caught in a broad-based selloff in commodity and equity markets today, triggered by concern over the potential collapse of a Chinese property developer. While loses could have been worse for corn today, bear spreading signals a weakening market. With harvest activity ramping up, December corn could continue to perform worse than deferred contracts amid farmer and commercial hedge pressure. Corn inspected for export during the week ended Sept. 16 totaled 403,104 metric tons (MT), up from 159,429 MT the previous week, USDA reported. Trade expectations ranged from 150,000 to 450,000 MT. Also today, USDA said 10% of the U.S. corn crop was harvested as of yesterday, matching trade expectations. Harvest progress was up from 4% a week ago and above the five-year average of 9%.

Soybeans: November soybeans fell 21 1/2 cents to $12.62 1/2 a bushel, the lowest settlement since $12.52 3/4 on June 17. December soybean meal fell $2.40 to $339.80 per ton. December soybean oil fell 139 points to 54.87 cents a pound, after hitting a three-month low. China has reportedly bought soybeans from Brazil and U.S. shipments have shrunk the past few weeks. Grain terminals at the U.S. Gulf are not expected to be fully operational for several more weeks due to damage from Hurricane Ida. U.S. soybeans inspected for export during the week ended Sept. 16 totaled 275,169 MT, up from an upwardly revised 193,429 MT the previous week but well under the 1.39 MMT shipped at this time last year, USDA said today. USDA also reported 6% of the U.S. soybean harvest was completed as of yesterday, compared to trade expectations for 5%.

Wheat: December SRW futures fell 8 cents to $7.00 3/4 a bushel. December HRW futures fell 13 cents to $7.00. December spring wheat futures fell 6 1/2 to $8.94. HRW led wheat futures lower as the market absorbed spillover pressure from weakness in global stock markets and bellwether commodities like crude oil. Grain futures were also pressured by dollar strength, as the U.S. dollar index rose near a one-month high. Export activity and U.S. Plains weather will be key drivers for wheat prices the next few weeks. Earlier today, USDA reported U.S. wheat inspected for export during the week ended Sept. 16 totaling 563,390 MT, down from an upwardly revised 567,438 MT the previous week and near the upper end of expectations. The U.S. winter wheat crop was 21% planted as of yesterday, up from 12% the previous week but about 1 percentage point short of trade expectations.

Cotton: December cotton futures plunged 331 points, or 3.5%, to 89.02 cents a pound, the contract’s lowest close since July 21. Cotton futures plunged as concern over potential financial contagion in China sent global stock markets and key commodities, including crude oil, tumbling. The U.S. dollar index climbed to its highest level in almost a month. While cotton demand remains firm, a big U.S. crop is expected this year and the potential collapse of property developer China Evergrande raises questions over the economic outlook. USDA will update cotton harvest progress this afternoon. As of yesterday, the U.S. cotton crop was 9% harvested, up from 5% a week earlier but below the five-year average of 11% for that date.

Cattle: December live cattle rose 55 cents to $128.075 per hundredweight. Feeder cattle futures ended with slight gains. The cattle market held up relatively well considering heavy pressure on the stock market today amid building U.S. and global economic concerns. Typically, the cattle market is rather responsive when the stock market leads a broad-based selloff in asset-based markets. Last week’s average cash cattle price was $123.88, down 91 cents from the previous week. Traders expect steady to weaker prices this week, though strong cash opinions won’t likely be formed until around midweek. The wholesale beef market showed potential signs prices may be forging a low, with a Choice cutout values rising $1.19 to $315.66, the first increase in over three weeks.

Hogs: October lean hogs fell 75 cents to $84.975 per hundredweight, while the December contract fell 82.5 cents to $74.225. Hog futures were pressured in part by general “risk-off” attitudes, as global stock markets tumbled and the U.S. dollar index neared a one-month high on concern over potential financial contagion from China. Bearish cash hog market fundamentals also kept buyers in hog futures on the sidelines today. National direct carcass values today fell $2.16 to $79.32, while the latest CME lean hog index price fell 19 cents to $94.26, the lowest since late March but still over $9.00 above October futures. Pork carcass cutout values today fell $2.52 to an average of $102.89, on movement of 293 loads.

 

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