Market Snapshot | March 4, 2022

Corn futures are sharply higher at midmorning, but well off their daily highs.

• Corn futures extended a recent rally to near nine-year highs on spillover from rallying wheat and indications global grain trade disruptions from the Russia/Ukraine war are boosting demand from China and other foreign buyers.
• May corn futures reached a contract high at $7.82 1/2 and are up from $6.55 3/4 at the end of last week.
• December futures posted a contract high at $6.47, topping the previous high on Feb. 24.
• March futures reached $7.87 1/4, the highest for a nearby contract since prices hit $8.00 in July 2013. Beyond $8.00, the upside target for bulls would be the all-time high of $8.43 3/4 from 2012.

Soy complex futures are mixed, with old-crop soybeans higher after fading from overnight gains and nearby May soymeal up over $12 while soyoil is lower.

• Nearby soybeans followed corn and wheat higher and also gained support from a pickup in exports and a rally of $5.00 in Nymex crude oil prices.
• China extended a buying spree in U.S. soybeans that began in late January. USDA reported daily soybean sales of 106,000 MT for delivery to China during the 2021-22 marketing year, along with daily soybean sales of 108,860 MT to Mexico and 125,000 MT to “unknown destinations,” both for 2021-22.
• Since Jan. 28, USDA has reported a combined 5.827 MMT of soybean sales to China or unknown destinations, a more than eight-fold increase from the pace over the previous month.
• May soybeans rose as high as $16.88 1/2, up from $15.84 1/2 at the end of last week. The most-active contract failed at chart resistance just under $17.00 the previous three sessions, suggesting the market may be establishing a near-term top.

Wheat futures are sharply higher, with May HRW and SRW contracts locked at the expanded 75-cent limit. Other contracts have come off limit up, including HRS contracts.

• May SRW futures opened overnight trading limit-up and nearby prices notched a record high on escalating concern over the Russia/Ukraine war, which has kept Ukrainian ports closed for over a week. A fire and Russian takeover of a Ukrainian nuclear plant fueled market fears.
• Export demand for European Union wheat surged this week and is expected to continue, Reuters reported. Paris-traded wheat futures posted a record high.
• May SRW wheat reached a contract high at $12.09 and is up nearly $3.50 from $8.59 3/4 at the end of last week. March SRW touched $13.40, the highest intraday price on record and topping the previous high in February 2008.
• May HRW futures posted a contract high at $12.25 1/4, up over $3.34 from $8.91 at the end of last week. May spring wheat touched $11.78 1/4, a contract high for the third straight day.

Live cattle futures are lower at midmorning but have rebounded from initial declines, while feeder futures are sharply lower.

• Live cattle futures are under pressure from technically-driven fund selling and concern the Russia/Ukraine war will harm beef demand.
• Feeder cattle are under pressure as corn futures extended a rally about $7.
• Cash cattle prices show signs of topping. Live steers this week averaged $140.48 through yesterday morning, down from last week’s average of $143.22.
• Choice grade cutout values fell $1.37 yesterday to an 11-month low of $254.35, though movement was strong at 153 loads.
• April live cattle broke under the November low and dropped to $133.50, the contract’s lowest intraday price since $132.975 on Sept. 13 and down from $141.925 at the end of last week.

Lean hog futures are down sharply but off initial losses.

• Hog futures are under pressure from fund selling, eroding technicals and geopolitical concerns.
• The CME lean hog index fell 14 cents today to $99.70, but seller interest in futures likely will be limited unless traders sense a stronger late-winter pullback is coming.
• Pork carcass cutout values fell $2.01 yesterday to $106.41, led by a decline of over $33 in bellies. Movement was strong at 360 loads.
• April lean hog futures fell as low as $100.75, the lowest intraday price since $100.30 on Feb. 7 and down from $103.675 at the end of last week.