Market Snapshot | January 23, 2024

Corn futures are mostly a penny higher at midmorning.

• Corn futures are being supported by mild corrective buying, though the market has slipped from earlier highs.
• South American crop consultant Dr. Michael left his Brazilian corn production estimate unchanged at 115 MMT but maintains a lower bias going forward. Cordonnier left his Argentine corn crop estimate unchanged at 56 MMT.
• Argentina rainfall will be minimal through the first days of next week but may increase late next week and into the following weekend, though confidence is not high, according to World Weather Inc.
• Beijing, who has been cautious on the development and deployment of GM crops, is steadily opening up to commercial cultivation. China has successfully completed its pilot projects for commercialization of GM seeds, an ag Ministry official said.
• March corn has tested the 10-day moving average, currently trading at $4.49 for the first time since Dec. 28. A move above the area will face additional resistance at $4.51 3/4, while initial support remains at $4.43 3/4.

Soybean futures are around 3 to 6 cents higher, while March soymeal is more than $3.50 higher. March soyoil is about 20 points higher.

• Soybeans are extending mild corrective gains for the fourth straight session, with meal futures leading the complex higher.

• Cordonnier left his Brazilian soybean estimate unchanged at 149 MMT but maintains a neutral to lower bias going forward. Cordonnier also left his Argentine soybean crop estimate unchanged at 52 MMT but continues to hold a neutral to higher bias.
• Brazil rainfall in the next two weeks will be most concentrated on center-west, northern center-south and northeastern parts of the nation where sufficient rain will fall to support normal crop development, states World Weather.
• Malaysian palm oil futures rose overnight, driven by concerns of severe rains disrupting production in Indonesia and Malaysia, along with strong demand from China, although weakness in rival oils capped gains.
• March soybeans have moved above the 10-day moving average of $12.25 3/4, with additional resistance at $12.36. Initial support lies at $12.13 3/4.

SRW wheat futures are mostly 3 cents higher, with HRW 5 to 10 cents higher. HRS is 1 to 3 cents higher.

• SRW wheat futures are posting followthrough gains despite notable U.S. dollar strength.
• Agriculture and Agri-Food Canada’s preliminary projections for the 2024-25 marketing year call for wheat seedings excluding durum to fall 2.9% from last year to 8.2 million hectares due to lower prices and relatively ample global supplies, though that would still be about 5% above the five-year average.
• Australia is poised to produce much more wheat and other crops this year than previously thought after rainfall confounded expectations that El Niño weather pattern would maintain dry and hot conditions, analysts and industry associations told Reuters.
• The European Commission is looking into ways of allowing eastern EU member states to restrict ag imports from Ukraine as it extends trade liberalization with Kyiv. EU Trade Commissioner Valdis Dombrovksis said the commission was about to present a proposal for the new period to June 2025, considering the sensitivities of agricultural sectors in eastern member states of the bloc.
• March SRW futures have marked the highest intraday level since Jan. 12, but are facing notable resistance at 100-, 20- and 40-day moving averages of $6.06, $6.06 1/4 and $6.08 1/4, respectively.

Live cattle are moderately higher, while feeders are posting moderate to strong gains.

• Nearby live cattle are showing strength amid surging wholesale values, though traders anticipate delayed cash cattle trade again this week.
• Last week’s average cash cattle price rose 29 cents from the previous week to $173.76. Cash negotiations are expected to be pushed late into the week again this week.
• Wholesale beef prices strengthened on Monday, with the Choice cutout up $3.17 to $298.67 and Select $3.53 higher to $286.58, though movement dipped to 78 loads
• February live cattle are facing resistance at $174.825. Initial support lies at $173.125.

Lean hogs are marking strong gains at midsession.

• Hog futures are sharply higher amid improving cash and wholesale fundamentals.
• The CME lean hog index is up another 34 cents to $68.40 as of Jan. 19, the ninth increase in the last 10 days.
• The pork cutout value rose $1.61 Monday to $90.17, edging above $90.00 for the first time since Nov. 6 of last year. Rising wholesale pork prices are strengthening packer margins, giving them incentive to keep raising cash hog bids.
• China’s sow herd declined 2.5 million head (5.7%) to 41 million head at the end of 2023, according to an ag ministry official. Farmers reduced their breeding herds during the final quarter of last year to cut losses amid poor margins and oversupply of hogs.
• February lean hogs have surged to the highest intraday level since Jan. 12, with resistance at the Jan. 12 high of $72.60 being tested. Initial support lies around $70.76.