Market Snapshot | December 13, 2022

Corn futures sustained overnight strength and rose to the highest levels in over a week as weather and supply concerns and a sharp drop in the U.S. dollar buoyed grain and soybean markets.
South American crop consultant Dr. Michael Cordonnier cut his Argentine crop estimates for a third straight week due to persistent heat and dryness. Dr. Cordonnier lowered his Argentine corn crop estimate another 1 MMT to 47 MMT, with a neutral to lower bias. Cordonnier kept his Brazilian corn estimate at 125.5 MMT.
Eight ships loaded with grain left ports in Ukraine’s Odesa region today after a pause caused by power cuts following Russian missile strikes over the weekend, the Ukrainian infrastructure ministry said. The Black Sea port of Odesa did not operate on Sunday.
The Ukrainian grain traders union UGA asked the government to ensure electricity to grain facilities to reduce potential damage to stored crops. Russia has been targeting Ukraine’s energy infrastructure with missile and drone strikes since October.
March corn reached $6.60, the contract’s highest intraday price since $6.60 1/2 on Dec. 2. Recent price strength bolsters ideas the market set a near-term bottom with a drop to a 3 1/2-month low of $6.35 on Dec. 7.

Soybeans are 17 to 20 cents higher, January soymeal is up more than $5 and January soyoil is nearly 150 points higher.

Soybean futures climbed near last week’s highs on fresh export business and concerns persistent dryness will curb South America’s production prospects.
USDA reported a daily sale of 140,000 MT of soybeans for delivery to “unknown destinations” during the 2023-24 marketing year. With today’s announcement, USDA has reported nine separate daily sales to China or unknown destinations totaling 1.966 MMT since Nov. 23.
Argentina’s crops are “still at risk” despite recent rain, World Weather Inc. said. “Subsoil moisture is still critically low and it will not take very many days of sunny weather to deplete topsoil moisture again returning serious crop stress to the driest areas.”
Cordonnier lowered his Argentine soybean crop estimate another 1 MMT to 47 MMT, with a neutral to lower bias. He kept his Brazilian soybean estimate at 151 MMT.
Malaysian palm oil futures rallied 4%, the biggest daily gain since Nov. 1, on lower-than-expected inventory numbers.
January soybeans reached $14.87 3/4, near last week’s high of $14.92 3/4.

Wheat futures are higher, led by gains of 6 to 12 cents in HRW contracts.

Wheat futures extended Monday’s gains as the U.S. dollar index dropped to a 5 1/2-month low and strength in crude oil spurred continued corrective buying and short-covering.
Southeastern Plains production areas may receive some rain and snow early next week, World Weather said. Greater snow cover will be needed to protect crops later this month due to an expected arctic air mass that could send temperatures dropping below zero Fahrenheit in central and northern areas.
Japan is seeking 154,942 MT of wheat in its weekly tender.
March SRW wheat rose as high as $7.69 1/4, the contract’s highest price since Dec. 2.

February live cattle futures posted a strong open and climbed near a three-week high on cash market optimism and a surge in wholesale beef prices that signaled robust demand.
A longer-term outlook for tight supplies is overshadowing a small pullback in the cash market’s recent upswing. The average live steer price last week fell 63 cents to $155.79, the first decline in 10 weeks. Cash sources expect generally steady cash cattle prices this week.
Choice beef cutout values surged $8.09 Monday to $257.02, the highest daily average since Nov. 17 and an indication packers’ recent price cuts spurred retail demand.
Blizzard conditions today in western Nebraska and northeastern Colorado will cause travel delays and livestock stress, World Weather said. The Northern Plains will also experience blizzard conditions today through Thursday, with snow “notably significant” in the central and western Dakotas, eastern Montana, and northern Minnesota.
February live cattle reached $156.775, the contract’s highest intraday price since $156.95 on Nov. 23. A push above the November high may spur bulls to target the contract high of $157.225 posted Oct. 27.

Hog futures are higher, led by gains of more than $1 in February and April 2023 contracts.

Lean hog futures may gain support from ideas the cash market is near a bottom.
The CME lean hog index is down 52 cents to $81.47 (as of Dec. 9), the lowest since late January. December futures, which expire Wednesday, are trading around 60 cents above the index, suggesting traders believe the cash index will soon bottom.
Pork cutout values fell $1.62 Monday to $86.94, led by a decline of over $6 in bellies. Movement was strong at 335 loads.
February lean hogs rose as high as $85.425, the highest intraday price since Dec. 8. Initial resistance includes a gap in the daily bar chart between the Dec. 7 low of $85.95 and the Dec. 8 high of $85.90.

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