Market Snapshot | October 21, 2022

Corn futures erased overnight declines to post modest gains with support from a pullback in the U.S. dollar.
Traders continue to monitor shipping problems on the Mississippi and updates the Ukraine export deal.
Turkish President Tayyip Erdogan said he sees no obstacles to extending the deal allowing Ukrainian Black Sea grain exports, after discussions with his Russian and Ukrainian counterparts this week. Erdogan’s remarks struck a more upbeat tone than that from Russian officials this week.
December corn pushed back above the 20- and 40-day moving averages but have been unable to move above Thursday’s high at $6.87. The contract is down from $6.89 3/4 at the end of last week.

Soybeans also bounced back from overnight declines with support from a recent upturn in export demand, with China making several purchases over the past two weeks. Harvest pressure and an outlook for record South American production are limiting price upside.
India will refrain from increasing duties on palm oil imports as it wants to avoid a surge in domestic prices at a time when inflation is running hot, Bloomberg reported.
Malaysian palm oil futures rose 0.1% and posted a 7% gain for the week as the arrival of the monsoon season raised production concerns.
November soybeans rose above the 10- and 20-day moving averages and appear poised to test Thursday’s high at $13.96 1/2. The contract is up from $13.83 3/4 at the end of last week.

Winter wheat futures recovered much of an overnight slide but remain down for the week amid pressure from slow exports and weakening technicals.
The U.S. Plains faces a “unique opportunity” for significant rain in some important winter wheat production areas late this weekend and early next week, World Weather Inc. said. Moisture from Tropical Cyclone Roslyn may contribute to “significant” moisture in Oklahoma, north-central Texas and southeastern Kansas, with rains of 1 to 3 inches possible.
The Buenos Aires Grain Exchange on Thursday lowered its estimate for Argentina’s 2022-23 wheat crop to 15.2 MMT, down from 16.5 MMT previously, a day after the Rosario Grain Exchange cut its wheat crop forecast to 15 MMT.
French farmers had sown 46% of the expected soft wheat area for next year’s harvest by Oct. 17, compared with 36% last year at this time. Mild weather has allowed planting to rapidly advance.
Turkey initially purchased around 470,000 MT of milling wheat – likely Black Sea (mostly Russian) origin.
December SRW wheat overnight fell as low as $8.33, just above the week’s low of $8.32 3/4 and down from $8.59 3/4 at the end of last week.

Live cattle and feeder cattle are mostly firmer at midmorning.

Live cattle futures are extending this week’s rally behind cash prices that are on track to hit the highest levels in seven years. Traders await for USDA’s Cattle on Feed Report after the close.
Feedlots secured $148 for cash cattle in the Southern Plains and $152 in the northern market on Thursday. Through Thursday morning, USDA-reported live steers averaged $149.89, up from last week's average of $146.99.
USDA’s Cattle on Feed Report this afternoon is expected to show the Oct. 1 feedlot inventory down 104,000 head (0.9%) from year-ago, which would be the first year-over-year decline since December 2021. Placements are expected to have declined 3.6% in September, while marketings are anticipated to have increased 4.0% from year-ago.
Choice beef cutout values rose 23 cents Thursday to $253.62, the highest since Sept. 13. Movement was strong at 178 loads.
December live cattle rose as high as $151.95, the contract’s highest intraday price since $152.225 on Sept. 20. October futures touched $149.90, a fresh seven-year high for the seventh consecutive session.

Hog futures are higher, led by strong gains in the December contract.

Lean hog futures resumed the steep rally of the past two weeks to post the highest levels in nearly five weeks. Strong technicals and firming cash markets continue to lift prices.
Today's CME lean hog index is up 56 cents to $93.76, the highest since Sept. 30. December futures’ discount to the index is currently about $5.585, the smallest gap since February.
While seasonal weakness is likely for winter-month contracts, the longer-term outlook leans bullish as supplies will tighten and Chinese demand for pork is expected to improve.
December lean hogs pushed above this week’s previous weekly high at $87.50 and reached $88.55, the contract’s highest intraday price since $89.075 on Sept. 20. A push above that September high may have bulls targeting the contract high at $91.35.

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