Market Snapshot | June 29, 2023

Corn is 6 to 11 cents lower midmorning.

• Corn futures are extending the sharp price pullback as rains fall across the Midwest.
• For week ended June 22, USDA reported net corn export sales of 140,400 MT for 2022-23, which were up notably from the previous week but down 16% from the four-week average. Net sales of 123,500 MT were reported for 2023-24. Sales were within the expected pre-report ranges of (100,000) to 500,000 MT and 0 to 200,000 MT, respectively.
• The Drought Monitor showed a 2.2% decline in drought areas over the past week, though 53.5% of the U.S. is still considered too dry. Iowa, Illinois and Indiana did not see much change from last week, with all three states at or close to 100% in a dry zone. Upcoming rains will not end the drought, but there likely will be a decrease in drought zones the next few weeks.
• The International Grains Council (IGC) trimmed its forecast for 2023-24 global corn production by 6 MMT to 1.211 billion metric tons. IGC estimates the U.S. corn crop at 373.4 MMT, down from its previous projection of 381.8 MMT.
• The head of Conab said Brazil’s government is set to purchase 500,000 MT of corn as it looks to start rebuilding public food stocks.
• December corn dropped below the 40-day moving average of $5.39 1/4, with support lying at $5.26 1/4.

Soybeans are mixed, while July meal futures are modestly weaker. July soyoil is around 40 points higher.

• Soybean futures are mixed amid light corrective buying and improving forecasts for the next couple of weeks.
• Increasing showers and thunderstorms across the Midwest during the coming week will provide some much-needed relief to dryness, though more rain will be needed, states World Weather.
• USDA reported net old-crop soybean sales of 227,400 MT for week ended June 22, which were down 50% from the previous week and 28% from the four-week average. New-crop sales of 17,000 MT were also reported. Traders were expecting sales to range from 200,000 to 500,000 MT for 2022-23 and 0 to 200,000 MT for 2023-24.
• November soybeans are trading narrowly in the lower end of Wednesday’s range. The 20-day moving average of $12.56 1/2 is serving as initial support, while resistance stands at $12.72 1/4.

SRW wheat is narrowly mixed, while HRW wheat is 1 to 3 cents higher. HRS wheat is 7 to 10 cents higher.

• Wheat futures are pausing following heavy selling the past three sessions.
• Weekly wheat sales of 155,200 MT were reported for 2023-24, which were near the low-end of the pre-report range of 50,000 to 400,000 MT.
• Wet weather coming to the Midwest this weekend into next week could slow SRW crop maturation and harvesting along with potential crop quality concerns, notes World Weather. There is also potential for hail and damaging winds in isolated locations.
• September SRW wheat dropped below the 20-day moving average of $6.74 1/4, while initial support is at $6.56. Resistance stands at $6.81.

Live cattle and feeders are mostly firmer at midmorning.

• Live cattle have mostly recovered from a weaker start, though buyer interest is limited.
• Cash cattle trade got underway around $2 lower than last week’s levels in both the Southern Plains and norther market.
• Wholesale beef prices continued lower with Choice down another $1.33 to $327.90, while Select fell $1.75 to $296.68, taking the Choice/Select spread to $31.22. Movement totaled 105 loads for the day.
• USDA reported net beef sales of 12,000 MT for 2023, down 9% from the previous week and 16% below the four-week average.
• August live cattle are trading within the upper end of Wednesday’s range, with yesterday’s high of $174.05 serving as resistance, while support remains at $172.60.

Lean hogs are lower at midsession.   

• July lean hogs are trading slightly lower as traders await USDA’s Hogs & Pigs Report.
• Traders are expecting USDA’s Hogs & Pigs Report this afternoon to show the U.S. hog herd as of June 1 was fractionally smaller than year-ago.
• The CME lean hog index is up another 4 cents to $92.96 as of June 27, and is up $21.78 since bottoming the third week of April. While daily price gains haven’t been strong, the seasonal climb has been steady.
• The pork cutout value fell $1.08 on Wednesday to $99.08, led by a near $7.50 drop in hams. Movement was light at 104.6 loads for the day.
• USDA reported net pork sales of 26,700 MT for 2023, down 7% from the previous week, but 3% above the four-week average.
• August lean hogs gapped lower at the open and are hovering mostly below the 10-day moving average around $90.95. Support at $90.48 and $89.87 have been tested, with additional support lying near $89.06.