Market Snapshot | April 26, 2022

Corn futures 2 to 7 cents higher at midmorning after trimming overnight gains.

• Old-crop futures turned higher around midmorning after a brief round of profit-taking sent prices down. New-crop contracts are sustaining overnight gains after USDA reported slower-than-expected planting progress.
• U.S. corn planting progress is moving at the slowest pace in nine years, raising concerns over reduced acreage or yields. USDA late yesterday reported 7% of the U.S. corn crop was planted as of April 24, up from 4% a week earlier but below expectations for 9% and under the 15% five-year average for the date.
• Temperatures across much of the Midwest are expected to drop near freezing during the first half of the week before weather warms closer to the weekend.
• The Midwest “will see a mix of rain and sunshine during the next two weeks,” World Weather Inc. said. “Conditions for fieldwork will improve overall and some planting should advance between rain events with the overall planting pace likely slower than what most producers would desire.”
• July corn early today reached $8.09 3/4, a few cents shy of resistance at the $8.14 contract high posted a week ago, before sinking to losses. December trimmed gains after reaching $7.46, nine cents under the contract high.

Soy complex futures are mixed, with soybeans and soyoil higher and soymeal lower.

• Soybean and soyoil futures trimmed overnight gains but remain supported by fresh export business from China and concerns over tight global vegetable oil supplies.
• USDA reported daily soybean sales of 132,000 MT for delivery to China during the 2022-23 marketing year and 133,000 MT for delivery to “unknown destinations,” with 78,000 MT is for delivery during 2021-22 and 55,000 MT for delivery during 2022-23.
• Today’s announcement came a day after USDA reported soybean sales to China totaling 534,000 MT for 2021-22 and 2022-23.
• USDA reported the U.S. soybean crop was 3% planted as of April 24, up from 1% a week earlier but down from the 5% five-year average for the date.
• Malaysian palm oil futures rose nearly 3% on a smaller supply outlook from major producer Indonesia, which will ban exports of refined, bleached and deodorized (RBD) palm olein April 28 until prices of bulk cooking oil drop to 14,000 per litre. The ban will not affect crude palm oil shipments.
• Crop Consultant Dr. Michael Cordonnier raised his Argentine soybean crop estimate by 1 MMT to 40 MMT, noting yields are rising as more of the later-maturing acres are harvested.
• July soybeans reached $16.96 3/4 but generated little followthrough buying after briefly rising above the 10-day moving average around $16.85. Initial support is seen at the 20- and 40-day moving averages at $16.51 1/4 and $16.52 1/2, respectively.

Wheat futures are higher, led by gains of 14 to 17 cents in winter wheat contracts.

• Nearby SRW wheat rose for the first session in six. July spring wheat posted a contract high at $11.99 3/4 before fading.
• Concerns over poor crop conditions in the U.S. Plains are supporting prices. The slower-than-normal spring wheat planting pace is also supportive.
• USDA reported an unexpected drop in winter wheat condition ratings, with the amount rated “good” or “excellent” falling three percentage points to 27%, the lowest for this time of year since 1989. When USDA’s weekly crop condition ratings are plugged into the weighted Pro Farmer Crop Condition Index (0 to 500-point scale, with 500 being perfect), the HRW crop plunged 10.8 points to 260.7, led by a 6.2-point drop in the Kansas crop and a nearly 3-point decline in Oklahoma. The SRW rating inched 0.4 point higher to 350.6. The HRW crop stands 69.5 points below the five-year average for the date, while the SRW crop was 9.1 points below normal.
• Frost and light freezes were reported this morning in U.S. wheat areas of the Central Plains and western portions of the Midwest SRW production region, though none of the cold likely was potent enough to induce any permanent harm to crops, World Weather said.
• Statistics Canada reported Canadian farmers intend to plant 25 million acres to wheat this year, up from 23.4 million acres last year and above traders’ expectations for 24.2 million acres. Stats Can estimated canola seedings at 20.9 million acres, down from 22.5 million acres last year and below expectations for 22.1 million acres.
• July SRW wheat briefly pushed above its 20-day moving average to reach $11.07, the highest intraday price since $11.18 1/2 on April 20. Initial resistance is seen around a potential double top at last week’s highs in the $11.43 to $11.43 1/2 area.

Live cattle are slightly to moderately higher while feeder cattle futures are mostly lower.

• Live cattle futures climbed in a technical correction after sharp declines Monday.
• Strength in corn prices pressured feeder futures.
• Cash prices will likely soften following two weeks of gains, though active trade isn’t likely until late in the week. Live steers averaged $143.02 last week, up $2 from the previous week.
• Choice beef cutout values fell $1.31 to $266.60 on light movement of 67 loads, suggesting that current prices are curbing demand.
• June live cattle are trading inside yesterday’s wide range. Technicals eroded substantially after the early week plunge left a gap between Friday’s low at $138.35 and Monday’s high at $136.85. Initial support comes in at yesterday’s low of $134.45.

Hog futures are sharply lower through the summer-month contracts.

• Lean hog futures fell sharply for a second day, posting three-week lows, on eroding technicals and demand concerns. The daily trading limit was expanded to $7.00 after Monday’s selloff sent June futures down the initial $4.75 limit.
• Wholesale pork tumbled to start the week, underscoring retailer resistance to prices above $110.00. Pork cutout values plunged $5.49 to $105.79, the lowest daily average since April 8. Movement totaled about 294 loads.
• Strength in cash benchmarks may help futures find a bottom, with the CME lean hog index up another 83 cents today to $102.50, the highest since March 31, on support from seasonal strength.
• June lean hogs fell as low as $111.125. Bears are targeting the March low at $109.15.