Market Snapshot | April 29, 2022

Corn futures are higher at midmorning, led by gains of around 6 cents in old-crop contracts.

• July corn posted contract highs for the third consecutive day, supported by strong export demand led by China. Concerns planting delays will persist into May supported new-crop futures.
• Delayed U.S. corn plantings are more concerning with limited progress likely in early May. The southwestern to eastern Corn Belt is expected to receive four rounds of rain through May 8, with most areas not likely to dry down enough to allow for fieldwork between rounds of rain, World Weather Inc. said today. “An important period of drier weather will occur May 9-13 with drier weather needed in the third week of the month to allow for planting to become aggressive,” the forecaster said.
• In addition to slow U.S. planting, concerns are building over dryness hurting production prospects for Brazil’s safrina crop. Mato Grosso do Sul and neighboring areas continued to dry down during the past week due to a lack of rain and warm weather. Many areas already have a shortage of moisture and little rain is expected for at least another seven days, World Weather said.
• July corn hit a contract high at $8.24 1/2 and is heading for a fourth straight weekly gain after ending last week at $7.89. December futures rose to $7.57, a contract high for the second day in a row.

Soy complex futures are mixed, with nearby soybeans up 13 to 15 cents and nearby soymeal up $5 to $7; nearby soyoil is more than 100 points lower.

• Soybean futures rose to highs for the week on demand optimism as China continues to buy U.S. old-crop soybeans.
• Unwinding of recent long soyoil/short meal spreads is impacting trade in the product markets.
• Indonesia should be able to address its cooking oil shortage in the next few weeks and lift an export ban on palm oil and its refined products in May, industry officials said. Crude palm oil prices in Indonesia are likely to fall sharply as the domestic market will be unable to absorb the increased supply, straining the country's storage infrastructure while prices in other markets such as Malaysia rise.
• China will auction another 500,000 MT of imported soybeans from state-owned reserves on May 6. Beijing has been selling state-owned soybean stocks to boost domestic prices and ease soymeal prices.
• July soybeans reached $17.04 3/4, the highest intraday price since $17.34 a week ago, and are poised to end up from last week’s close at $16.88. New-crop November hit $15.40 1/4, also a weekly high.

Wheat futures are lower, led by declines of 20-plus cents in several nearby HRW and SRW contracts.

• HRW futures fell to a three-week low amid an outlook for rain relief for parched soils in the U.S. Plains. Poor export demand also burdened winter wheat.
• U.S. HRW wheat areas are heading for a “wetter biased period,” World Weather said. “The moisture will help improve crop and field conditions ahead of reproduction,” with Central Oklahoma, northern and eastern Kansas and Nebraska poised to receive the most rain.
• Southwestern HRW areas “will get some rain, but not enough to carry normal crop development to the end of the growing season,” the forecaster said. Still, “a temporary reprieve from drying is expected.”
• July HRW wheat fell as low as $11.12, the lowest intraday price since April 8, while July SRW dropped to $10.61 1/4 and is on track to post a second straight weekly loss.

Live and feeder cattle are mostly lower at midmorning.

• June live cattle futures fell for the fifth session in the past six and hit a three-week low as increasingly bearish technicals outweigh signs of firmer beef demand
• Choice boxed beef prices firmed 69 cents Thursday, ending a recent string of declines. Despite higher prices, packers moved 168 loads of beef, including 160 Choice boxes.
• Cash prices have firmed as the week progressed, with live steers averaging $143.12 through Thursday morning, up about 10 cents from last week’s average.
• June live cattle fell as low as $133.00, the lowest intraday price since $132.475 on April 6, and are down from $138.425 at the end of last week.
• Technicals have turned increasingly bearish after June futures gapped lower to start the week, and a break under the April 6 low could have bears targeting the March low at $130.975.

Hog futures are down sharply and led by summer-month contracts.

• Lean hog futures extended this week’s steep declines, sinking near three-month lows on slumping technicals patterns and eroding cash benchmarks.
• The CME lean hog index is down 53 cents today. Futures’ slump has basically erased all of the nearby May contract’s premium to the index.
• Wholesale pork prices remain under pressure, with cutout values dropping $1.02 Thursday to $104.49, near a three-week low. Movement slowed to 248 loads.
• China’s sow herd declined 3.3% in March to 41.9 million head, down 3.1% from last year. China had 422.5 million head of hogs at the end of March, down 5.9% from the previous month but up 1.6% from last year, according to the country’s ag ministry.
• June lean hog futures fell as low as $108.20, the contract’s lowest intraday price since $107.80 on Feb 4, and is down from $118.775 at the end of last week. Futures’ weak technical performance this week signals further downside, possibly under $105.00 and near the February lows.