Market Snapshot | May 11, 2022

Corn futures are firmer at midmorning with gains of 8 to 10 cents.

• Corn futures climbed to highs for the week on concerns over slow U.S. planting and ahead of USDA’s Supply and Demand update Thursday that’s expected to reflect tighter supplies.
• USDA is expected to lower estimated U.S. corn ending stocks for 2021-22 by about 28 million bu. to 1.412 billion bu., based on a Reuters survey.
• U.S. ethanol production averaged 991,000 barrels per day (bpd) during the week ended May 6, up 22,000 bpd from the previous week and up 1.2% from the same week a year earlier, the Energy Information Administration reported. Ethanol stocks increased 253,000 barrels to 24.140 million barrels, the first increase in six weeks.
• July corn reached $7.90 1/2, a high for the week, and faces initial resistance at the 10-day moving average around $7.93. Initial support is seen at this week’s low of $7.69, reached Monday.

Soy complex futures are mixed, with soybeans up 12 to 15 cents and July soyoil up aroound 140 points, while soymeal is mostly lower.

• Soybean futures extended Tuesday’s rebound behind demand optimism, tight supplies and strength in Malaysian palm oil and crude oil, with nearby U.S. futures up nearly $5.00.
• Concerns over slow planting progress continue to support new-crop futures.
• USDA is expected to lower its projection for 2021-22 U.S. soybean ending stocks to about 225 million bu. from 260 million bu. last month.
• July soybeans overnight topped Tuesday’s high and reached $16.15. The contract faces initial resistance at Monday’s high of $16.26.

Wheat futures are higher, led by gains of 20 cents in July spring wheat.

• Wheat futures rose behind ongoing concerns over poor crop conditions in the U.S. Plains and delayed planting in the Northern Plains.
• India exported a record 1.4 MMT of wheat in April, Reuters reported, providing some relief to grain markets disrupted by Russia’s war in Ukraine
• July SRW wheat rose as high as $11.26 1/2, and the market’s recent strength may have bulls targeting this week’s high at $11.35.
• July spring wheat posted a contract high for the second day this week, reaching $12.47 1/4.

Live cattle futures are higher at midmorning while feeder cattle are lower.

• Live cattle futures rose on corrective buying, while feeder cattle are being pressured by strength in corn. Slumping wholesale beef prices continue to drive demand concerns.
• Choice beef cutout values fell $3.05 Tuesday to $255.24, near an eight-month low, but movement was strong at 202 loads, illustrating how packers are slashing prices to keep product moving.
• Cash cattle trade started around $140 in the Southern Plains Tuesday, roughly steady with last week’s price, and while there wasn’t much trade in the northern market, initial prices were also steady. If the recent pattern holds, cash prices will climb through the week.

Hog futures are lower at midmorning.

• Lean hog futures are under pressure from weak technicals and concerns over pork demand.
• Pork cutout values fell $4.20 Tuesday, led by a $15.53 plunge in belly prices, as packers cut prices to move product.
• Today’s CME lean hog index (as of May 9) is unchanged at $101.09 as the benchmark stabilized following a two-week slide.
• June lean hogs fell as low as $99.50, the contract’s first drop under $100.00 since mid-January. The contract is now below the cash index, which is extremely unusual for this time of year.