Corn: December corn fell 7 cents to $5.32 1/2 a bushel, after touching a four-week high earlier in the session. The lead contract is up 7% from a five-month low of $4.97 1/2 high hit Sept. 10. Futures faded from overnight gains amid expectations for expanding supply pressure from what’s expected to the second-largest U.S. corn harvest on record. Weaker crude oil prices also stanched buying interest in grain futures, though Nymex crude was still approaching $77.00 a barrel, near a two-month high. USDA yesterday reported the U.S. corn crop was 18% harvested as of Sept. 26, up from 10% the previous week and above the five-year average of 15% for this date.
Soybeans: November soybeans fell 10 1/2 cents to $12.77 a bushel, the contract’s first decline in six sessions. December soymeal fell 50 cents to $339.50 per ton and December soyoil fell 65 points to 57.46 cents a pound. The grain and soy complex lacked support from outside markets, such as crude oil, as was the case yesterday. Nymex crude futures were down nearly 1% late today but have still rallied over 6% the past week. Ag futures trading was relatively subdued ahead of USDA’s quarterly Grain Stocks report. U.S. soybean stockpiles as of Sept. 1 are expected to shrink to 174 million bu., based on a Reuters survey of analysts. That figure is down 67% from the same date in 2020 and would be the smallest Sept. 1 soy stocks figure since 2014.
Wheat: December SRW wheat fell 15 3/4 cents to $7.06 1/2 a bushel, with December HRW futures down the same amount to end at $7.05. December spring wheat sank 14 1/4 cents to $9.07 1/4. Improved prospects for the 2022 wheat crop seemed to undercut wheat futures Tuesday. USDA’s weekly Crop Progress report estimated winter wheat plantings as of September 26 at 34% complete, up from 13% the week prior and two percentage points above the five-year average for late September, suggesting plantings are going well. Moreover, the latest forecasts indicate a series of fronts will cross the Southern Plains in the days ahead, potentially giving the just-planted crop some much-needed moisture.
Cotton: Cotton futures continued climbing despite diminished support from outside markets. Most-active December futures ended the day 198 pints higher at $1.0003 cents per pound, a 10-year high. Strong demand continues to drive the cotton futures higher. Today’s advance was particularly impressive when one considers concurrent weakness that occurred in the equity indices, energy and grain markets. Traders were likely encouraged that yesterday’s surge was powered by fresh buying, as indicated by the 8,283-lot jump in open interest posted this morning. That was the largest in five years. The expiring October contract didn’t top the $1.00 per pound level, but the most-active December future soared to 101.55 cents at the daily high before setting back. The last time nearby cotton futures topped the $1.00 level was in November 2011. Given widespread expectations for a large fall harvest, the latest strength has once again confirmed the strength of underlying demand, especially with transport issues remaining a significant problem for the cotton sector.
Cattle: December live cattle fell 30 cents to $127.50 per hundredweight, the contract’s third consecutive daily decline. November feeder cattle rose $1.475 to $157.05, after falling earlier in the day to $155.00. Live cattle futures remained under pressure from continued weakness in boxed beef prices and higher-than-expected feedlot placements in USDA’s August Cattle on Feed report. Feeder futures drew support from declines in corn prices. Slumping wholesale beef prices convey a soft retail demand picture with the summer grilling season over and expected pre-holiday purchases still weeks away. Choice cutout values fell $1.13 today to an average of $301.56, the lowest price since $299.80 on Aug. 9, USDA data showed. Cattle slaughter so far this week was an estimated 240,000 head, down 0.4% from the same point last week but up 2.6% from the same period a year ago.
Hogs: December lean hogs surged $2.025 to $83.575 per hundredweight, the highest closing price since $84.25 on Aug. 3. Hog futures extended yesterday’s daily-limit rally, reaching the highest levels in nearly two months on wholesale market strength and expectations for tighter supplies. Last Friday’s surprisingly bullish USDA quarterly Hogs and Pigs report indicated reduced supplies into 2022. Rising open interest in lean hog futures this week suggests new longs coming into the market, implying more upside price potential in the near-term. Pork cutout values fell $3.83 today to an average of $108.12, after posting a gain this morning. The cutout average is still up 6.9% from a six-month low of $101.12 in mid-September. Carcasses on national direct markets fell $1.19 to $75.74, down 18% since the end of August.