10:30 a.m. Market Snapshot

Corn futures were 7 to 14 cents lower at midsession, led by weakening July contracts.

• Strong initial government crop ratings weighed on corn futures. The U.S. corn crop was rated 76% “good” or “excellent” as of the beginning of the week, according to the USDA. That was at the high end of analysts’ expectations.
• The corn crop was 95% planted at the beginning of the week, compared to the five-year average of 87%, the USDA said.
• Corn futures should find support from ongoing concerns over dry Midwest conditions, strong export demand and expectations for crop shortfalls in other top producing countries.
• Brazil, for example, has seen harvest outlook crimped by drought. StoneX Group cut its forecast for Brazil’s total corn crop 89.68 MMT, down from 100.25 MMT in a May projection.
• Weather remains supportive but prices are up more than 75 cents from last week’s lows and some consolidation is likely. But a high-range weekly close is needed to keep momentum rising.
• December corn futures face resistance around yesterday’s high of $5.58 1/2 and support around yesterday’s low of $5.51.

Soybean futures have pared gains to 8 to 10 cents. Soymeal futures are trading $1.50 to $2.80 lower, erasing earlier gains. Soybean oil futures are sharply higher, up about 130 to 220 points at midsession.

• July soybean futures opened weak and rallied, but the contract failed to clear yesterday’s session high at $15.78 1/2. November beans rose above yesterdays high before running into some light profit-taking at midsession.   
• U.S. farmers have seeded 84% of their soybean crop. Seeding progress has not been a market concern this spring amid the drier-than-normal conditions.
• USDA will release its first U.S. soybean crop ratings next week and they may not be as high as the initial corn ratings yesterday after frost across portions of the Dakotas, Iowa, Minnesota and Wisconsin.
• A strong high-pressure ridge will progress slowly eastward over the next nine days, which will limit rainfall and cause extreme heat with highs ranging from the upper 80s to the upper 90s.
• Showers late next week will need to verify to limit stress in parts of Iowa, Illinois, northern Missouri, southern Wisconsin, eastern North Dakota, central South Dakota and western Minnesota.
• Brazilian soybean exports reached 16.4 MMT in May, a record for this time of the year and less than 1 MMT below the record shipped in April, official customs data showed Tuesday.
• Soyoil is leading higher, with some deferred contracts rising to new highs. July soybean oil’s share of the crush margin rose to a new high of 46.9% this morning, adding support to beans.

Spring wheat futures are up 7 to 13 cents, but winter wheat futures are down 4 to 5 cents, erasing earlier gains at midsession.

• Spring wheat futures are leading higher, with September reaching the highest since May 7 when it touched a contract high at $8.10 3/4. The price is up about $1.20 since touching a six-week low last week.
• Concern over this week’s hot and dry weather in the northern U.S. Plains and southern Canada’s Prairies is the market focus with only limited rain potential for next week.
• U.S. spring wheat was rated just 43% “good” and “excellent” (G/E) with 80% of the crop emerged.
• The U.S. winter wheat crop was rated 48% G/E, up 1% from the prior week and right at the five-year average. Drier weather next week will aid harvesting and reduce quality concerns.
• Russia's new formula-based grain export taxes will remain in place as long as there is increased global demand for food, Deputy Prime Minister Victoria Abramchenko told Reuters. "Lower supply in the global food market will result in large consumers having to summon food from all over the world. We have to maintain a certain amount of grain in the country,” she said.
• The government plans to update the taxes each week, which will complicate forward sales to major customers and may shift buying to other global suppliers, traders have said.

Cattle futures were mostly higher at midsession, led by nearby live contracts. Feeder futures were also higher.

• Futures rebounded from yesterday’s declines as JBS, one of the top beef processors, resumed operations after a ransomware attack forced a temporary shutdown at several plants.
• Resumption of most of JBS’s operations was seen as a relief to the cattle trade. The JBS shutdown resulted in a sharp decline in slaughter, with Tuesday’s estimated kill at 94,000 head, down 27,000 head from a week ago.
• Futures remain supported by strong beef prices, which climbed to start the holiday-shortened week. Choice boxed beef rose $3.59 higher yesterday and Select rose $5.55. Movement rose to to 139 loads.
• Last week, cash trade occurred at an average price of $119.64, down 8 cents from the week prior. Most look for steady prices this week.
• August live cattle rose as high as $118.30 early today, partially closing a gap lower resulting from the slump Tuesday, when the contract posted an intraday low of $118.55.

Hog futures were mostly lower at midsession, retreating from contract highs in several contracts yesterday.  

• July hogs matched yesterday contract high at $120.40 and turned lower into midmorning. Momentum is up but overextended. More important, the technical studies did not make new highs with the new high in futures, a warning signal.
• The ransomware attack on JBS also interrupted hog processing Tuesday, with 390,000 head estimated slaughtered on Tuesday, down 95,000 head from the week prior.  
• The pork cutout value climbed 53 cents yesterday and movement improved to 344.31 loads.
• Prices are reaching extremes set in 2014 and now the key will be export demand.
• Hog prices in China continue to fall. Even farms using their own piglets are now losing money. That may trim new Chinese purchases.