Market Snapshot | December 20, 2022

Corn futures climbed in narrow-range trading as strength in soybeans and a sharp drop in the U.S. dollar index encouraged corrective buying.
Crop Consultant Dr. Michael Cordonnier kept his Argentine corn crop estimate at 47 MMT after a “temporary reprieve” from weekend rains and lower temps. He has a neutral to lower bias for the crop.
Cordonnier held his Brazilian corn estimates at 125.5 MMT for corn but noted “developing dryness in southern Brazil is becoming a concern.”
China is scrambling to strengthen its healthcare system as Covid-19 spreads through the country. Officials in several cities are building “fever clinics” at hospitals to treat patients. Five Covid-related deaths were reported on Tuesday, but the true figure is likely to be far higher. State media said the country should return to “normalcy” within a few months.
March corn extended overnight gains and climbed as high as $6.54 1/4 but failed to generate much followthrough buying after pushing slightly above the 20-day moving average.

Soybeans are 15 to 19 cents higher, nearby soymeal is more than $4 higher and nearby soyoil is around 150 points higher.

Soybean futures rose near last week’s highs behind technical buying, strength in soymeal and recent strength in export demand. South America weather also added support.
Drought continues across Argentina’s summer crop areas, causing delays in planting, emergence and establishment, World Weather Inc. said. “Accelerated production cuts are still possible without better rainfall soon.”
Cordonnier cut his Argentine soybean crop estimate for a fourth consecutive week, this time by 2 MMT to 45 MMT, amid “problematic” weather. He kept his Brazilian soybean estimate at 151 MMT.
China’s November soybean imports from the U.S. fell 6.9% from a year earlier, General Administration of Customs data showed, reflecting low U.S. river levels slowing shipping of beans to ports for export. China imported 3.38 MMT from the U.S. last month, down from 3.63 MMT a year earlier.
March soybeans rose above the 10-day moving average to reach $14.87 1/2, near last week’s high at $14.92.

Wheat futures are higher behind firming technicals and concerns frigid conditions in the Plains this week may damage crops.
Extremely cold temperatures and blizzards will hit central parts of North America mid- to late-week and “will bring all kinds of problems,” World Weather Inc. said. Extreme lows in the -30s and -20s Fahrenheit are likely in the Northern Plains, and subzero lows will occur southward to the Texas Panhandle and central Oklahoma.
Taiwan tendered to buy 56,000 MT of U.S. milling wheat. Japan is seeking 144,441 MT of milling wheat in its weekly tender.
March SRW wheat pushed above Monday’s high before falling short of a test of 40-day moving average resistance at $7.64 1/4.

Nearby live cattle are under mild corrective pressure following two days of gains, with expectations cash prices will remain firm supporting prices.
Kills will be lower this week and next as plants take extended downtime around Christmas and New Year’s Day.
Packers will attempt to boost cutting margins around the holiday-shortened schedules, though cash prices are likely to hold around steady with last week’s $155.69 average since feedlots are well positioned to not have to move a lot of cattle if prices drop much.
Choice beef cutout values rose $1.00 Monday to $263.83, near a six-week high, but movement was again light at 74 loads.
Feeder cattle are moderately to sharply higher despite strength in the corn market.

Hog futures are mixed.

Nearby lean hogs faded under pressure from indications the cash market has yet to find a seasonal bottom following an extended slide.
The national direct cash hog price dropped 79 cents on Monday, with the Iowa/Minnesota market down $1.98.
The CME lean hog index is down 71 cents to $80.84 (as of Dec. 16), the lowest level since Jan. 27, signaling the cash market has not yet put in a seasonal low.
Pork cutout values fell $2.51 to $84.93, back near an 11-month low posted last week, but movement was strong at 336 loads.

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