Ahead of the Open | April 7, 2022
GRAIN CALLS
Corn: 1 to 4 cents lower.
Soybeans: 4 to 7 cents higher.
Wheat: 2 to 6 cents lower.
GENERAL COMMENTS: Wheat futures fell overnight and corn also declined as traders prepared for USDA’s Supply & Demand update tomorrow and monitored the Russia/Ukraine war. Soybean futures firmed overnight. Malaysian palm oil futures fell for a second straight session following larger than expected March production, while Nymex crude oil is up around $1 after earlier falling to a three-week low. U.S. stock index futures signal a mixed open, while the U.S. dollar index is slightly weaker this morning.
Conab lowered its Brazilian soybean crop estimate to 122.4 MMT, down from 122.8 MMT last month. By comparison, USDA last month cut its projection for Brazil’s crop by 7 MMT to 127 MMT. USDA will likely make another cut on Friday.
Canada’s federal government is increasing up-front cash support in a farming payments program as fuel and fertilizer shortages plague the 2022 planting season. The government will temporarily waive the requirement for pre-production advances to be issued in two installments, Agriculture and Agri-Food Canada said Wednesday.
Japan purchased 137,516 MT of milling wheat, including 59,999 MT from the U.S., 49,107 from Canada and 28,410 MT from Australia. The Philippines bought 55,000 MT of feed wheat – likely from India. Jordan tendered to buy 120,000 MT of optional origin milling wheat.
CORN: USDA reported net U.S. corn sales for the week ended March 31 totaling 782,400 MT for 2021-22, up 23% from the previous week but down 44% from the average for the previous four weeks. For 2022-23, net sales totaled 145,200 MT. Sales were expected to range from 475,000 MT to 1 MMT for 2021-22 and 100,000 to 400,000 MT for 2022-23.
May corn futures traded within yesterday’s range overnight, just above $7.50, after dropping 3 1/4 cents yesterday to $7.56 1/2.
SOYBEANS:Net weekly soybean sales for 2021-22 totaled 800,700 MT, down 39% from the previous week and down 38% from the prior four-week average. Top buyers included China (435,700 MT, including 66,000 MT switched from “unknown destinations,” decreases of 2,300 MT, and 67,000 MT of late reportings). Net sales for 2022-23 totaled 298,500 MT. Sales were expected to range from 500,000 MT to 1.15 MMT for 2021-22 and 100,000 to 400,000 MT for 2022-23.
WHEAT: Net weekly wheat sales totaled 156,300 MT for 2021-22, up 65% from the previous week but down 11% from the prior four-week average. For 2022-23, net weekly sales totaled 223,000 MT. Sales were expected to range from 50,000 to 500,000 MT for 2021-22 and 50,000 to 250,000 MT for 2022-23. May SRW wheat traded within yesterday’s range overnight after falling 7 cents yesterday to $10.38 1/4.
LIVESTOCK CALLS
CATTLE: Steady-firm
HOGS: Steady-weak
CATTLE: Live cattle futures may find support as an ongoing climb in wholesale beef signals improved retailer demand. Choice cutout values fell 49 cents yesterday to $271.04, down from a near three-month high. But movement was strong at 141 loads, as retailers boosted purchases at cheaper prices. USDA-reported live steers averaged $138.70 through yesterday morning, down from last week’s average of $139.32. Net weekly U.S. beef sales totaled 14,000 MT for 2022, down 39% from the previous week and down 43% from the average for the previous four weeks.
June live cattle rose 90 cents yesterday to $134.225 after hitting a three-week low earlier in the session. May feeder cattle rose 95 cents to $159.95.
HOGS: Lean hog futures may face pressure from continuing erosion in cash fundamentals, but a surge in exports may encourage buyers and limit price declines. The CME lean hog index is down another 58 cents today to $101.08, a drop of $2.58 over the past five days but still $2.33 above the April contract’s settlement Wednesday. Pork cutout values rose 77 cents yesterday to $104.37 on movement of 286.6 loads. Net weekly pork sales totaled 41,200 MT for 2022, up 49% from the previous week and up 44% from the prior four-week average. Mexico was the lead buyer at 13,200 MT, followed closely by China at 13,000 MT. Through February, U.S. pork shipments to China were down 71.1% from the first two months last year.
April lean hogs rallied $1.075 yesterday to $98.75 and June futures rose 35 cents to $114.70.
