Market Snapshot | December 2, 2022

March corn broke below the past month’s trading range and dropped to the lowest level in over three months as spillover from sharp declines in wheat spurred further fund liquidation.
The UN Food and Agriculture Organization (FAO) global food price index fell for an eighth consecutive month in November as declines in cereal grains, dairy and meat offset increases in vegetable oils and sugar.
FAO’s world cereal grain production forecast for 2022-23 was cut 7.2 MMT from last month to 2.756 billion MT, due mainly to smaller corn production. Cereal grin production is now expected to fall 57 MMT (2.0%) from 2021-22.
March corn broke under the November low of $6.53 1/2, the bottom of the past month’s trading range, and fell to $6.47 1/4, the contract’s lowest intraday price since Aug. 23. Support comes in at the Aug. 23 high of $6.38.

Soybeans are 11 to 12 cents higher, January soymeal is around $1.50 higher and January soyoil is down more than 200 points.

Soybeans climbed on corrective buying following sharp losses Thursday. Tight supplies and strong demand continue to underpin prices, encouraging buying on price weakness.
Dryness in South America is also supporting soybeans. In Argentina, little rain expected through the next week along with hot temperatures will stress crops in the many areas in central and northern parts of the country, World Weather Inc. said today.
In Brazil, additional rain through Tuesday “will be important in increasing soil moisture in the driest areas” in western and central regions, World Weather said.
Malaysian palm oil futures fell 2.9% and posted a 4.4% decline for the week on strength in the ringgit and sharp weakness in soyoil.
China will auction another 500,000 MT of soybeans from state-owned reserves on Dec. 9.
January soybeans overnight fell to $14.25 1/2, down from $14.36 1/4 at the end of last week and 1/4 cent above Thursday’s low. Before rebounding. The 40-day moving average at $14.22 marks initial support.
January soyoil gapped lower at the start of overnight trade and fell as low as 64.50 cents, the lowest since Oct. 17.

Wheat futures are down sharply, led by declines of 15 to 18 cents in HRW and SRW contracts.

SRW wheat tumbled to a 10-month low as weak exports, a rebound in the U.S. dollar and bearish technicals fueled fund selling.
Record Russian production and continuing shipments from the Black Sea region is contributing to pressure on wheat futures. Russia’s wheat export tax for Dec. 7-13 will be 2,806.8 rubles ($45.41) per MT based on an indicative price of $313.10. That’s up from a rate of 2,788.0 rubles per MT the previous week.
March SRW wheat fell as low as $7.55 3/4, the contract’s lowest intraday price since Aug. 19 and down from $7.97 at the end of last week.
March HRW wheat fell as low as $8.60 1/4, a three-month low.

Live cattle and feeder cattle futures are firmer at midmorning.

Live cattle futures continue to draw support from expectations cash prices will sustain a strong trend.
Cash cattle prices firmed in the northern market Thursday, though some feedlots continued to hold out for even higher prices. Trade in the Southern Plains has been at mostly steady prices. Through Thursday morning, USDA-reported live steers averaged $155.23, down from last week's $156.07 average.
Choice beef cutout values fell $1.31 to $253.57 on continued strong movement of 161 loads.
February live cattle pushed above the 10-day moving average around $155.60 but are holding within Thursday’s range. The contract is up from $155.25 at the end of last week. Initial resistance is seen at this week’s high of $156.10.

Hog futures are mostly higher, led by gains in spring 2023 contracts.

Lean hog futures extended Thursday’s sharp gains, hitting the highest levels in a week, but are off the initial highs at midmorning.
The CME lean hog index is down another 65 cents to $83.24 (as of Nov. 30). December futures are trading about 44 cents under today’s cash quote, suggesting traders sense a seasonal low is close.
Pork cutout values fell 81 cents Thursday to $86.52 as movement slowed to about 277 loads.
February lean hogs reached $89.95, up from $88.50 at the end of last week and the contract’s highest intraday price since Nov. 25.

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