After the Bell | March 7, 2022
Corn: May corn futures fell 3 1/2 cents to $7.50 3/4, while December corn firmed 13 1/4 cents to $6.42 3/4. Corn futures failed to sustain strong overnight gains despite wheat trading sharply higher and broad strength in commodities. Today’s price action was corrective in nature as traders took some profits out of the long side of the market and also unwound bull spreads. While additional corrective trade is possible Tuesday, another surge in wheat futures would likely bring buyers back to the corn market. Weekly USDA export inspections were strong again at 62.3 million bushels, which lowers the projected weekly pace to hit USDA’s current export forecast to 43.3 million bushels.
Soybeans: May soybean futures fell 1 cent to $16.59 1/2, after rising as high as $16.96 3/4 overnight. May soybean meal fell $1.70 to $458.70 and May soybean oil rose 142 points to 74.22 cents. Nearby soybeans extended a technically driven setback as traders awaited USDA’s Supply and Demand Report on Wednesday. The Russia/Ukraine war continued to push wheat prices higher but is less of a factor for soybeans, which continued to show signs of exhaustion and a potential near-term top. Drought-driven crop losses in South America are driving soybean export business to the U.S., and China continues to snap up cargoes. USDA reported daily soybean sales of 132,000 MT for delivery to China. Since Jan. 28, USDA has reported a combined 5.96 MMT of soybean sales to China or unknown destinations.
Wheat: May SRW wheat rose the expanded 85-cent limit to $12.94, while nearby futures hit a record high. May HRW wheat rose 37 cents to $12.51 1/2. May spring wheat rose 50 1/2 cents to $11.97 1/2. SRW and HRW daily trading limits expand to $1.30 Tuesday. The Russia/Ukraine war continued to fuel concern over disruptions to the global grain trade. While futures mostly retreated from limit-up gains, prices likely will remain elevated. Earlier today, USDA reported 343,463 MT of U.S. wheat inspected for export during the week ended March 1, down from 429,984 MT the previous week.
Cotton: May cotton rose 52 points to 116.94 cents per pound after dropping earlier to 115.37 cents, a seven-week low. Cotton futures rebounded from initial declines as the escalating Russia/Ukraine conflict drove rallies in crude oil and wheat markets. Early declines stemmed from weakness in U.S. stocks and strength in the U.S. dollar, which posted a 22-month high today against a basket of global currencies. Cotton market focus is shifting to Wednesday’s USDA Supply and Demand Report, which is expected to show an increase in projected U.S. exports and a slight decline in global stockpiles.
Cattle: April live cattle firmed $2.125 to $137.90. April feeders strengthened $2.425 to $159.675. Cattle futures corrected higher after nearly two weeks of persistent fund-driven selling. A drop in corn futures helped fuel a corrective rebound in feeders. Cash cattle averaged $140.61 last week, down $2.61 from the previous week and the first weekly decline in the past five. With April live cattle well below last week’s average cash price, there are limited prospects for higher cash cattle prices this week unless there an extended price recovery in futures. Choice cutout values rose 38 cents today to $254.71 on movement of 102 loads.
Hogs: April lean hog futures fell 17.5 cents to $100.275, the lowest closing price since Feb. 4. Lean hog futures fell on followthrough pressure in the wake of Friday’s limit-down close. However, today’s close near mid-range suggests bulls may be able to stabilize futures prices early this week. Cash fundamentals showed signs of a seasonal top, with the next CME lean hog index projected to drop 29 cents to $99.28. Pork carcass cutout values jumped $2.66 today to $106.65, led by gains in hams. Movement was decent at 311 loads. Today’s hog slaughter was estimated at 479,000 compared to 451,000 last week and 491,000 one year ago at this time.
